Fundamentally Speaking

USDA will update the 2022/23 carryouts again in the March 2023 WASDE but before then at this week's Agricultural Outlook Forum, USDA will update its initial forecasts for the 2023/24 balance sheet estimates for the major crops.

That got us to thinking on how close to the mark USDA is in pegging ending stocks for the upcoming season in late February a year later in the February WASDE report when half the marketing year is about done for corn and soybeans and about three-quarters for that of wheat.

This chart shows the change in the February WASDE U.S. ending corn, soybean, and wheat stocks from what was estimated a year earlier at their Feb USDA Ag Outlook in million bushels (mb) on the left-hand axis and the percent change in the right-hand axis.

At the February 2022 Ag Outlook Forum 2022/23, corn, soybean and wheat stocks were projected respectively at 1.965 billion bushels (bb), 305 mb and 731 mb.

The current USDA 2022/23 corn ending stocks figure at 1.267 bb is a sizable 698 mb below what USDA projected a year ago which is a 35.5% understatement and the second largest percent difference since the 2012/13 season, and well below the average of a 2.3% overstatement.

The current 2022/23 wheat ending stocks figure of 568 mb is 168 mb below the year ago projection, a 22.3% miss and the largest percent difference since the 2012/13 season and well below the average of a 3.1% overstatement.

The current 2022/23 ending stocks for soybeans as per this month's WASDE report at 225 mb are 80 mb below the 305 mb given at the February 2022 Ag Outlook Forum, which is a 26.2% understatement and also well below the average of a 1.5% understatement.

This is the first time since the 2013/14 season that the February WASDE ending stock figures for corn, soybeans and wheat are all below what USDA had projected a year earlier at their Ag Outlook Forum, and similar to that year, can be attributed to far lower production than the USDA had projected last year based on adverse growing conditions that impacted all three crops.

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