Fundamentally Speaking

USDA will update the 2024/25 carryouts again in the March 2025 WASDE, but before then at next week's Agricultural Outlook Forum they will release the initial forecasts for the 2025/26 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 2024 Ag Outlook Forum, 2024/25 corn, soybean and wheat ending stocks were projected respectively at 2.532 billion bushels (bb), 435 million bushels (mb) and 769 mb.

The current USDA 2024/25 corn ending stocks figure at 1.540 bb is a huge 992 mb below what the USDA projected a year ago which is the second largest overstatement in bushel terms since the Outlook projections were introduced in the 1998/99 season, a 39.2% overstatement which is well below the average of a 1.3% understatement.

The current 2024/25 soybean ending stocks figure of 380 mb is just 55 mb below the year ago projection, a 12.6% understatement and is above the average of a 1.5% understatement.

Finally, the current 2024/25 ending stocks for wheat as per this month's WASDE report at 794 mb is a mere 25 mb above the 769 mb given at the February 2024 Ag Outlook Forum which is a 3.3% overstatement, exactly the 1998-2024 average miss.

The standard deviation for the percent differences are much higher for corn and soybeans than wheat which may be explained by the fact that the USDA does have at least one piece of wheat data to work with at the time of their Ag Outlook Forum projections in late February which is the winter wheat seedings report that is released the second week in January.

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