Fundamentally Speaking

USDA will update the 2023/24 grains carryout numbers again in the March 2024 WASDE but before then at this week's Agricultural Outlook Forum, they will update the initial forecasts for the 2024/25 balance sheet estimates for the major crops.

That got us to thinking on how close to the mark the 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 on the left-hand axis and the percent change in the right-hand axis.

At the February 2023 Ag Outlook Forum 2023/24 corn, soybean and wheat stocks were projected respectively at 1.867 billion bushels (bb), 290 million bushels (mb) and 608 mb.

The current USDA 2023/24 corn ending stocks figure at 2.172 bb is a sizable 305 mb above what USDA projected a year ago which is a 16.3% overstatement and the second largest upward percent difference since the 2008/09 season and well below the average of a 2.3% overstatement.

The current 2023/24 wheat ending stocks figure of 658 mb is just 50 mb above the year ago projection, an 8.2% overstatement and is above the average of a 3.1% overstatement.

Finally, the current 2023/24 ending stocks for soybeans as per this month's WASDE report at 315 mb is a mere 25 mb above the 290 mb given at the February 2023 Ag Outlook Forum which is an 8.6% overstatement and the smallest percent differential either way since the 2016/17 season and runs contrary to the average of a 1.5% understatement.

This is the first time since the 2017/18 season that the February WASDE ending stock figures for corn, soybeans and wheat are all above what USDA had projected a year earlier at their Ag Outlook Forum and appears based on far better final 2023 corn and soybean yields than could have been expected given weather during last year's growing season and a rather desultory export outlook for all three markets.

(c) Copyright 2024 DTN, LLC. All rights reserved.