- It is probably fair to say that today’s report has come and gone with little in the way of statistical fireworks and prices have been little changed from earlier in the day.
- Primary data, which the market has been trading, is a reduction in corn production and a boost in 2015/16 soybean output. Soybean yield was increased a touch to 47.1 bushels/acre vs. 46.9 in August with a corresponding increase in output. Corn yield was reduced to 167.5 bushels/acre vs. 168.8 in August, again impacting overall output. Wheat was left pretty much unchanged as NASS will update final wheat figures in the 30 Sep small grains report.
- US corn end stocks were reduced to 1,592 million bu, down 121, month on month due to reduced production and reduced carry in stocks, old crop exports boosted a touch with surprising July shipments and increased ethanol use. New crop demand was unchanged.
- 2015/16 soybean end stocks were reduced 20 million bu as a function of reduced carryin. Old crop crush was raised and exports also grew and old crop stocks fell 30 million bu month on month. With reduced carryin overall new crop supplies fell slightly.
- US wheat stocks grew 25 million bu with a like for like reduction in exports. Finally the USDA could not ignore cheaper FOB offers from around the world into early winter.
- Overall the numbers were uneventful. Ear and pod weights will doubtless be debated into the more relevant October report. Longer term price direction will focus closely upon US export numbers and competitiveness. Given current wheat and corn US Gulf basis levels it does to look bullish right now. Global currencies, higher non-US acres and potentially ongoing El Niño will likely weigh on longer term market direction.
- We continue to favour selling decent price rallies.
- Our recap of the report in pdf format can be downloaded by clicking on the link below: