This article was originally posted at 11:05 a.m. CST. It was updated at 12:10 p.m.
OMAHA (DTN) -- USDA increased the 2021-22 soybean yield by nearly a bushel to 51.5 bushels per acre (bpa) on Tuesday, increasing soybean production to 4.448 billion bushels (bb) while also increasing corn yield slightly, raising corn production for the 2021-22 corn crop to 15.019 bb.
USDA also dropped 2021-22 wheat ending stocks to 580 million bushels (mb), the lowest ending stocks in 14 years, based largely on lowered production.
USDA on Tuesday released the monthly World Agricultural Supply and Demand Estimates (WASDE) for October.
According to DTN Lead Analyst Todd Hultman, Tuesday's new U.S. ending stocks estimates were bearish for corn and soybeans, neutral for wheat, while Tuesday's world ending stocks estimates were bearish for corn and soybeans but bullish for wheat.
You can also access the full reports here:
For DTN's exclusive audio comments on today's reports, visit: http://listen.aghost.net/…
-- Crop Production: https://www.nass.usda.gov/…
-- World Agricultural Supply and Demand Estimates (WASDE): http://www.usda.gov/…
For the 2021-22 corn crop, USDA increased yield by .2 bpa to 176.5 bpa. Production was increased 23 mb to 15.019 bb. USDA also increased the carryover of old crop to 1.236 bb. That put total supply at 16.280 bb for the 2021-22 corn crop.
USDA lowered Feed and Residual use by 50 mb to 5.65 bb. Food, seed and industrial use was increased 5 mb to 6.63 bb. Exports were also increase 25 mb to 2.5 bb. Still, total use was lowered 20 mb to 14.780 bb. That put the 2021-22 projected ending stocks at 1.5 bb, up 92 mb from September projections.
The average farmgate price held steady at 5.45 per bushel.
As expected, USDA revised downward some numbers from the 2020-21 old-crop corn production. Area harvested was reduced by 200,000 acres to 82.3 million acres. Yield was reduced .6 bushels to 171.4 bpa. Production was lowered by 71 mb to 14.111 bb.
USDA lowered old-crop feed and residual use by mb to 5.597 bb. USDA did raise exports by 8 mb for the old crop. With lower overall usage raised by 121 mb, USDA came with total old-crop usage at 14.819 bb.
Despite the lower production numbers, 2020-21 ending stocks were revised upward by 49 mb to 1.236 bb, in line with the NASS ending stocks figure released at the end of September. The total remains the lowest carryover in seven years.
Globally, old-crop ending stocks came in at 289.99 million metric tons (mmt), up 3.51 mmt from September.
In new-crop (2021-22) corn, beginning stocks were up 3.51 mmt and production was increased .45 mmt. Exports were increased .64 mmt and ending stocks for global corn were increased 4.11 mmt to 301.74 mmt. USDA made no changes for export forecasts for Argentina at 53 mmt or Brazil at 118 mmt but did lower Ukraine production 1 mmt to 38 mmt.
USDA increased the national average soybean yield for the 2021-22 season to 51.5 bpa, resulting in a 74 mb increase in production to 4.45 bb. Both yield and production came in toward the high end of pre-report estimates.
Ending stocks for the new-crop 2021-22 season, which also reflect changes made to the 2020-21 season following the Sept. 30 Grain Stocks report, rose to 320 mb from last month's estimate of 185 mb.
In addition to production increases, USDA lowered its import estimate by 10 mb, revised crush upwards by 10 mb, left exports unchanged and adjusted the residual estimate by 1 mb. The result is total use of 4.4 bb of use and 320 mb of ending stocks. The national average farm gate price declined 55 cents to $12.35 per bushel.
On the old stocks ledger, USDA adjusted production to 4.22 bb, up 81 mb from last month's estimate, reflecting its increase in national average yield to 51 bpa. Crush use was revised upward by 1 mb, exports came in 5 mb higher and residual was adjusted to -3 mb, a 7 mb decline. Overall usage was unchanged at 4.51 bb. Ending stocks landed at 256 mb, which USDA found as the result of its September survey of ending stocks. The national average farm gate price declined by a dime to $10.80 per bushel.
Globally, 2021-22 ending stocks rose 5.68 mmt to 104.57 mmt, reflecting higher beginning stocks particularly for the United States, Argentina and China. USDA increased production and slightly lower crush. USDA lowered its forecast for Argentina's production by 1 mmt to 51 mmt.
USDA expects U.S. wheat production for 2021-22 to drop to 1.646 bb, down 51 mb from the September report. The agency trimmed averaged projected yield to 44.3 bpa and lowered harvested acres to 37.2 million acres. Ending stocks landed at 580 mb, based on that drop in production and a 10 mb drop in imports, which together more than offset a 25 mb drop in feed and residual use.
The average farmgate price for wheat were adjusted 10 cents upward to $6.70 per bushel.
Globally, wheat ending stocks for old crop wheat were left sitting at 288.36 mmt, on the low end of pre-report analyst expectations, and down from 292.6 mmt in the September report.
New-crop world wheat ending stocks were also dropped below expectations, to 277.18 mmt, a more than 6-mmt drop from September. In production estimates, USDA bumped Canadian new crop wheat production down 2 mmt to 21 mmt, boosted the EU production slightly to 139.4 mmt and left Russia, Ukraine and Argentina production unchanged.
Annual beef production moved from a previously reduced position in recent WASDE reports to increasing 90 million pounds for the 2021 year, and showing significant increases in 2022 of 120 million pounds. This compares to moderate to strong reductions in both 2021 and 2022 from last month's report.
The October estimate posted an expectation of annualized beef production in 2021 of 27.8 billion pounds, up from 27.7 billion pounds last month. Production heading into next year is also significantly revised, with the new estimate of 26.9 billion pounds. Although overall beef production in 2022 is still expected to have a significant pullback from this year's levels, with next year overall production expected to fall 837 million pounds from current year estimates.
Pork production is expected to be significantly cut during the 2022 year, although estimates of current year production have been curbed slightly from the last report release. Pork production in 2021 is estimated at 27.67 billion pounds, down 65 million pounds from the September projection. The most aggressive and major shift is seen in 2022 production levels, as pork production in 2022 is estimated at 27.5 billion pounds, compared to 28.1 billion pounds in the September report. This is a reduction of 560 million pounds of pork production based on overall hog herd size shifts realized over the last month.
Barrow and gilt prices in 2022 were the most adjusted, moving from $56 per cwt last month to a current estimate of an annual price level of $61 per cwt. The majority of this price support is seen in the first and second quarter of 2022, although it is interesting to note that, even with the revision of projected production and prices, 2022 price levels are still expected to come in significantly lower than price levels through the second and third quarter of 2021. This could create additional challenges for hog production as lower overall supply is also being met by demand concerns.
Pork exports projections for 2021 have been scaled back by 135 million pounds of pork as concerns of moving additional product to China through the remainder of the year could be limited compared to previous market expectations.
Overall total use of beef and pork during 2021 has posted positive moves, increasing 135 million pounds from last month's estimate. Beef use is 2022 also increased 135 million pounds, while the lower production of pork is being carried through in overall use reductions as total use of pork in 2022 is now projected at 21.9 billion pounds, which is a 525-million-pound reduction from last month's report.
Livestock trade has taken the report in stride Tuesday morning, with prices moving very little from pre-report levels. The focus on lower pork production has already essentially been factored into the market, as well as most of the long-term concerns of pork demand in the coming year.
Editor's Note: Join DTN Lead Analyst Todd Hultman at 12 p.m. CDT on Tuesday, Oct. 12, for a look at what the day's numbers mean for grain prices. To register, visit: https://ag.dtn.com/…
|U.S. PRODUCTION (Million Bushels) 2021-22|
|U.S. AVERAGE YIELD (Bushels Per Acre) 2021-22 (WASDE)|
|U.S. HARVESTED ACRES (Million Acres) 2021-22|
|U.S. ENDING STOCKS (Million Bushels) 2021-22|
|WORLD ENDING STOCKS (Million metric tons) 2020-21|
|WORLD ENDING STOCKS (million metric tons) 2021-22|
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