Lower exports caused USDA to bump up ending wheat stocks higher than expected, increasing ending stocks to 598 million bushels (mb) while USDA made no monthly changes to domestic corn or soybean supply or demand in the December World Agricultural Supply and Demand Estimates (WASDE).
USDA cut 2021-22 wheat exports by 20 mb to 840 mb in the report.
According to DTN Lead Analyst Todd Hultman, Thursday’s U.S. estimates were neutral for corn and soybeans and slightly bearish for wheat. Hultman pegged the world ending stocks estimates as a little bearish for corn and wheat, and a little bullish for soybeans.
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USDA made no monthly changes to the December numbers for domestic corn supply and demand but made multiple changes to the global numbers.
Globally, USDA increased 2021-22 beginning stocks by 820,000 metric tons to 292.69 million metric tons (mmt). Global production was increased 4.11 mmt to 1,208.73 mmt. Production was bumped up 2 mmt in Ukraine to 40 mmt.
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Global exports were bumped up 1.39 mmt to 204.86 mmt. Global ending stocks were increased 1.12 mmt to 305.54 mmt.
For the 2021-22 domestic corn crop, USDA held the crop yield at 177 bushels per acre (bpa). Production also held pat at 15.062 billion bushels (bb), the same as the November report.
On the demand side, USDA maintained ethanol use at 5.25 bb despite forecasts of strong demand and higher production. Total domestic corn use for 2021-21 remained 12.33 bb. USDA held pat with export demand at 2.5 bb.
Ending stocks for the 2021-22 corn crop are projected at 1.493 bb.
The average farmgate price was $5.45 a bushel, holding pat going back to October.
USDA left soybean ending stocks for 2021-22 unchanged at 340 mb, below the range of pre-report estimates. The agency left beginning stocks unchanged at 256 mb. On the demand side, USDA left exports unchanged at 2.05 bb
The national average farm-gate price stayed at $12.10 per bushel.
USDA left old-crop (2020-21) ending stocks unchanged at 256 mb.
Globally, ending stocks for 2021-22 declined by 1.78 mmt to 102 mmt, below the range of pre-report expectations. USDA lowered global production by about 2.23 mmt with a smaller crop in China of 16.4 mmt, down from November’s 19 mmt. USDA left Brazilian production unchanged at 144 mmt and Argentina’s at 49.5 mmt. Global exports are expected to grow by 250,000 metric tons to 172.34 mmt.
USDA’s increase of the 2021-22 domestic wheat ending stocks to 598 mb was based largely on a drop in exports by 20 mb, down to 840 mb, from the November estimate. The agency also dropped imports by 5 mb but left all other supply and demand factors untouched. Although higher than the November ending stocks estimate, the 598 mb is still the lowest wheat ending stocks in eight years.
Globally, USDA increased wheat ending stocks to 278.18 mmt, above pre-report expectations, based on an increase in a beginning stocks (up 1.69 mmt) and production (up 2.61 mmt), which offset slightly increased feed use. The agency also bumped up wheat exports by 2.3 mmt to 205.47 mmt, and increased imports as well, by 1.91 mmt to 202.96 mmt.
The boost in global wheat production came mostly from Australia (up 2.5 mmt to 34 mmt) and Russia (up 1 mmt to 75.5 mmt), with smaller increases in the EU and Canada, while Argentinean production stayed flat at 20 mmt.
U.S. farmgate prices for wheat were bumped up $7.05 per bushel, up 15 cents from the November report.
Thursday’s WASDE report came in neutral for the beef and pork markets. Beef production rose by 10 million pounds as slaughter speeds have been excellent, and ample domestic and foreign beef demand have helped push packers to run vigorous processing speeds.
Steer fourth quarter prices grew by a fancy $5.00 to $133.00, which makes the fourth quarter the highest yield quarter of the year for steer prices in 2021.
From November, beef imports grew by 55 million pounds and exports remained steady at 3.45 million pounds.
From last month, pork production grew by 55 million pounds as hogs are carrying heavier carcasses and slaughter has been fairly aggressive.
Fourth quarter barrow and gilt prices fell by a $1.00 from last month to average $56.00, which makes the fourth quarter the second lowest price point that hog prices have seen in 2021, second to the first quarter, which averaged $55.71.
From November, pork imports grew by 15 million pounds, and pork exports fell by 30 million pounds as exports demand from China has weakened.
|U.S. ENDING STOCKS (Million Bushels) 2021-22|
|WORLD ENDING STOCKS (Million metric tons) 2020-21|
|WORLD ENDING STOCKS (million metric tons) 2021-22|