Frank J. Buchman

Cowboy • Horseman • Writer

Lower Corn Production With More Soybeans Predicted In Latest Report

In its October report, the United States Department of Agriculture (USDA) estimated 2023 corn yield to be 173 bushels per acre to produce 15.064 billion bushels.

Last month’s estimates were for 173.8 bushels per acre and 15.134 billion bushels.

The trade was expecting a corn yield of 173.5 bushels per acre and a total production number of 15.1 billion bushels.

Soybean yield in October’s report is pegged at 49.6 bushels per acre to produce 4.104 billion bushels.

Last month’s estimates were for 50.1 bushels per acre and 4.146 billion bushels.

The trade was expecting a yield of 49.9 bushels per acre and a total production number of 4.132 billion bushels.

U.S. 2023/2024 corn ending stocks were estimated at 2.111 billion bushels versus the trade’s estimate of 2.145 billion and September’s estimate of 2.221 billion bushels.

For soybeans in October, the U.S. ending stocks were e at 220 million bushels versus the trade’s expectation of 236 million bushels. Last month’s estimate was also 220 million bushels.

USDA in the October report pegged the U.S. wheat ending stocks at 670 million bushels, above the trade’s expectation for ending stocks to remain at September’s estimate of 615 million bushels.

“The October 2023/2024 U.S. corn outlook is for reduced supplies, lower feed and residual use and exports, and smaller ending stocks,” USDA said.

Corn supplies are forecast at 16.451 billion bushels, a decline of 160 million bushels from September, with lower production and beginning stocks. Exports are reduced 25 million bushels reflecting smaller supplies and slow early-season demand.

Feed and residual use is down 25 million bushels based on lower supply. With supply falling more than use, corn ending stocks for 2023/2024 are lowered 110 million bushels.”

Concerning soybeans USDA said, “Soybean exports are reduced 35 million bushels to 1.76 billion with increased competition from South America. Soybean crush is projected at 2.3 billion bushels, up 10 million, driven by higher soybean meal exports and soybean oil domestic demand.

Soybean oil domestic use is raised in line with an increase for 2022/2023. With lower exports partly offset by increased crush, ending stocks are unchanged from September at 220 million bushels.”

“The outlook for 2023/2024 U.S. wheat in the October report is for higher supplies, increased domestic use, unchanged exports, and higher ending stocks,” USDA said.

“Supplies are raised 85 million bushels, primarily on higher production as reported in the National Agricultural Statistics Service (NASS) Small Grains Annual Summary.

Domestic use is raised 30 million bushels, all on higher feed and residual use. The NASS Grain Stocks report indicated a higher year-to-year increase for June-August domestic disappearance than previously expected. Exports remain at 700 million bushels with several offsetting by-class changes.

Projected ending stocks are raised by 55 million bushels to 670 million, up 15 percent from last year.”

Naomi Blohm with Total Farm Marketing said: “This was a supportive report because each category of grains had a friendly component to it.

“Lower yield for corn and beans, lower ending stocks for corn and soybeans. Trade was looking for an increase in ending stocks, so the fact that they kept ending stocks unchanged was huge.

“Global ending stocks were lower. Technical bottoming signals are happening on charts, and we finally might see funds give up on some of those short positions and buy them back. This was a friendly report.”

Jeremy McCann, account manager at Farmer’s Keeper, said: “It’s fair to say this is a win for the bulls. Still, moving forward nothing has changed. We hope Mexico stays in the corn market and China for soybeans. Furthermore, recent rain should have a positive impact on basis levels, if only at the river and its surrounding market.”

Al Kluis of Kluis Commodity Advisors: “It was bullish because they dropped yields further and faster than the trade expected but maybe in hindsight we shouldn’t have been surprised because yields are varying all over. “Short term it’s bullish to the beans especially. Long term it really gives an incentive to the Brazilian farmers to plant more beans.”


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