- WOW! USDA and China travelled back to 2007 and found 149 million mt of corn that the Chinese had misplaced! World end stocks almost doubled. In soy, USDA reduces Chinese imports to 90 million mt from 94, and US exports were reduced 4.35 million mt (160 million bu), raising US end stocks 70 million. Non-US exports were increased and world end stocks only increased by 2 million mt.
- It will take the world a while to digest the increase in Chinese stocks. Our opinion is that it will have little impact on current markets, except to take away bullish hopes of Chinese demand for ethanol and/or corn. The rest of the world has to live with shrinking year on year supplies of non-Chinese corn, likely requiring more US acres to slow the decline. We believe corn is well supported in current ranges. Soybeans likely trade the current ranges as well, the bottom end of the range is vulnerable if US/China trade talks are slow in making real progress.
To download our USDA data recap please click on the link below: