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Tweaks and Nudges Expected in June WASDE Report

Todd Hultman
By  Todd Hultman , DTN Lead Analyst
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USDA will release its latest Crop Production and World Agricultural Supply and Demand Estimates (WASDE) reports at 11 a.m. CDT Tuesday. (Logo courtesy of USDA)

USDA's June WASDE report will have an update of U.S. wheat production and perhaps some adjustments to U.S. demand tables, but domestic changes are typically small in this monthly report.

USDA will release its latest Crop Production and World Agricultural Supply and Demand Estimates (WASDE) reports at 11 a.m. CDT on Tuesday, June 12.

CORN ENDING STOCKS

Based on Dow Jones' survey of analysts, the average pre-report estimate for ending stocks of new-crop corn is 1.642 billion bushels, down a little from 1.682 bb cited in May. Analysts expect slightly higher U.S. corn crop production at 14.072 bb, based on a slightly higher yield of 48.6 bushels per acre, but it is more likely that USDA will stay with most of its same estimates from May for both the supply and demand sides of the ledger.

USDA's estimate of world ending corn stocks for the current 2017-18 season is expected to come down a little, from 194.9 million metric tons to 193.4 mmt (7.03 bb), thanks to dry weather in Brazil. Dow Jones' survey expects Brazil's corn crop estimate to be reduced, from 87.0 mmt to 84.0 mmt (3.05 bb), and there is also a chance for another small reduction in the crop estimate for Argentina. Another spot to check will be China where drier conditions have been mentioned to the north.

SOYBEAN ENDING STOCKS

For U.S. ending soybean stocks, analysts surveyed expect USDA to increase its estimate from 415 million bushels to 435 mb in 2018-19. A slight reduction is expected in the estimate of old-crop ending soybean stocks. But there is also a risk for that number to go a little higher as well, as soybean shipments remain behind USDA's estimated pace. As with corn, analysts expect slight increases in the estimates of new-crop soybean production and yield, but USDA is likely to stay with its May numbers of 4.28 bb and 48.5 bpa, respectively.

Dow Jones' survey expects world estimates of soybean ending stocks in the current season of 2017-18 to edge lower, from 92.2 mmt to 91.2 mmt (3.35 bb), even though Brazil's soybean crop is expected to nudge higher, from 117.0 mmt to another new record high of 117.5 mmt (4.32 bb). Argentina's soybean crop estimate is expected to slip from 39.0 mmt to 37.8 mmt (1.39 bb) as this year's drought continues to shrink their crop estimates.

WHEAT ENDING STOCKS AND PRODUCTION

As the winter wheat harvest is just getting underway in the U.S., USDA's updated wheat crop estimates in June are not expected to change much, but a surprise is possible. Dow Jones' survey expects USDA to keep U.S. wheat production roughly unchanged at 1.82 bb while the winter wheat estimate is trimmed from 1.192 bb to 1.187 bb. Hard red winter wheat is expected at 641 mb, soft red winter wheat at 319 mb, and white winter wheat at 228 mb. USDA's estimate of U.S. ending wheat stocks is expected at 957 mb, down from 1.079 billion bushels in the old-crop season that just ended on May 31.

With last week's reports of dry weather in Ukraine and southern Russia, it will be interesting to check if USDA makes any changes to those crop estimates. Analysts surveyed by Dow Jones expect USDA to trim its estimate of world ending wheat stocks in 2018-19, from 264.3 mmt to 263.7 mmt (9.69 billion bushels. If true, that would bring ending wheat stocks down roughly 2% from 270.3 mmt (9.93 bb) in 2017-18, but not enough to expect much change in this year's range of wheat prices.

As mentioned, a surprise is always possible. But it is difficult to imagine what that might be this year, and USDA's June WASDE report has not typically offered much in the way of surprises. It may help to know that July corn has moved plus or minus 1.1% on average the past five years on the day of the June WASDE reports.

Given last week's bearish breaks in corn and soybean prices, traders are likely to be more concerned about what the weatherman says than anything we are about to read in Tuesday's WASDE report. Even so, stay tuned for DTN's coverage of the WASDE report and any surprises we might uncover.

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Editor's Note: Join DTN Analyst Todd Hultman at 12 p.m. CDT on Tuesday, June 12, as he evaluates USDA's latest production estimates for the U.S. 2018-2019 crops as well as old-crop and new-crop supply and demand tables. To register, visit https://dtn.webex.com/…

2017-18 U.S. ENDING STOCKS (Million Bushels)
June Avg High Low May 2016-17
Corn 2,163 2,208 2,125 2,182 2,293
Soybeans 523 550 473 530 302
Grain sorghum
Wheat 1,079 1,100 1,060 1,070 1,181
2018-19 U.S. ENDING STOCKS (Million Bushels)
June Avg High Low May
Corn 1,642 1,790 1,425 1,682
Soybeans 435 702 390 415
Grain sorghum
Wheat 957 994 820 955
2018-19 U.S. PRODUCTION (Million Bushels)
Jun Avg High Low May 2017-18
Corn 14,072 14,215 14,007 14,040 14,604
Soybeans 4,293 4,430 4,275 4,280 4,392
U.S. AVERAGE YIELD (Bushels Per Acre) 2018-2019 (WASDE)
Jun Avg High Low May 2017-18
Corn 174.2 176.0 173.1 174.0 176.6
Soybeans 48.6 50.0 48.5 48.5 49.1
2018-19 WINTER WHEAT PRODUCTION (Billion Bushels)
June Average High Low May 2017-18
All Wheat 1,820 1,870 1,754 1,821 1,741
All Winter Wheat 1,187 1,228 1,127 1,192 1,269
HRW 641 676 585 647 750
SRW 319 325 314 315 292
White 228 242 202 229 227
2017-18 WORLD ENDING STOCKS (million metric tons)
June Avg High Low May 2016-17
Corn 193.4 195.0 190.0 194.9 227.5
Soybeans 91.2 93.0 88.3 92.2 96.4
Wheat 270.3 271.0 268.0 270.5 255.9
2018-19 WORLD ENDING STOCKS (million metric tons)
June Avg High Low May
Corn 157.3 160.0 150.7 159.2
Soybeans 86.3 91.3 83.5 86.7
Wheat 263.7 268.0 260.0 264.3
WORLD PRODUCTION (Million Metric Tons) 2017-2018
June Avg. High Low May 2016-17
Corn
Brazil corn 84.0 87.0 73.9 87.0 98.5
Argentina corn 32.4 33.0 31.0 33.0 41.0
Soybeans
Brazil soybeans 117.5 119.0 117.0 117.0 114.1
Argentina soybeans 37.8 39.0 36.0 39.0 57.8
2018-19 2017-18
Wheat June May June May
European Union 150.4 151.58
FSU - 12 127.44 142.20

Todd Hultman can be reached at todd.hultman@dtn.com

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Todd Hultman