USDA Reports Preview
October WASDE Report Sharpens Production Estimates
Armed with producer surveys and field data from late September and early October, USDA makes a stronger case for its corn and soybean production estimates at 11 a.m. CDT on Thursday, Oct. 12. Data from USDA's Sept. 29 reports will also be included in Thursday's October estimates.
CORN
In USDA's September WASDE report, an increase of 800,000 acres sent the corn crop production estimate to 15.134 billion bushels (bb), close to the old record of 15.148 bb set in 2016. A lower yield estimate of 173.8 bushels per acre (bpa) prevented corn from reaching a new record, but even that yield seemed too high for many in the Western Corn Belt where crops went without significant rain for several weeks after mid-August. Both corn and soybean crops in 2023 started the year without much rain and largely ended the season the same way, saved mostly by a wet stretch of broad rain coverage in July and early August.
In addition to more planting data being available, the September WASDE was the first report of the year to include field observations from late August and early September. This month's observations from producer surveys and field data have the benefit of coming one month later and are in a better position to assess the late dry stretch of weather crops experienced. Historically, USDA's corn and soybean production estimates in October have a 90% confidence interval of less than plus or minus 5%.
Dow Jones' survey of 19 analysts expects USDA to estimate a slightly smaller corn crop of 15.100 bb, based on a yield of 173.5 bpa and a smaller harvested area of 86.7 million acres. If close, those estimates will disappoint many western corn producers who have seen more than their share of hot and dry weather in 2023, in contrast with eastern producers who fared better.
Dow Jones' survey also expects USDA's estimate of U.S. ending corn stocks to lighten, from 2.221 bb to 2.145 bb, the most in five years if correct. It is still early to be confident about USDA's demand estimates for 2023-24. Corn export commitments are up 9% early in the new season, but USDA's export estimate of 2.050 bb looks suspiciously high and will likely be challenged in future reports.
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For world ending corn stocks in 2023-24, Dow Jones expects USDA to slightly lower its estimate from 313.99 million metric tons (mmt) to 313.0 mmt. There may be an adjustment to USDA's current estimate of 137.0 mmt for Brazil's corn production in 2022-23 as it is higher than most. It is still early to be confident about South American estimates for 2023-24. USDA's 277.0 mmt corn production estimate for China may also get attention after USDA's attache in Beijing increased its estimate to 280.0 mmt or 11.0 bb last week.
SOYBEANS
For soybeans, Dow Jones' survey expects USDA to slightly reduce its crop estimate from 4.146 bb to 4.132 bb, based on a slightly lower national yield of 49.9 bpa. If true, that isn't much of a change and will still be the smallest soybean crop in four years, largely limited by a planting estimate of 83.6 million acres. Soybean yields are notoriously difficult to estimate, especially in an unusual year like this one that saw crop conditions roller coaster from stressful to favorable and back to stressful again.
In the aftermath of a modestly higher Sept. 1 stocks total in USDA's Grain Stocks report, USDA is expected to increase its estimate of U.S. ending soybean stocks for 2023-24 from 220 million bushels (mb) to 236 mb, still a candidate for the lowest ending stocks in eight years. It's a bit unnerving for soybean prices, but the prospects for new-crop demand deteriorated in September and early October, as export sales are off to a slow start, and crush incentives have fallen significantly. It may be early, but I wouldn't be surprised to see USDA trim new-crop demand by roughly 40 mb in Thursday's report.
Dow Jones expects USDA to slightly increase its snapshot estimate of world soybean stocks from 119.25 mmt to 119.60 mmt, a record-high total if achieved. USDA's 2023 soybean production estimate of 156.0 mmt or 5.73 bb for Brazil seems stable by now. The new season is just getting started with 10% of Brazil's new crop planted, according to the private firm AgRural. As with corn, it is too early to be confident about South American estimates for 2023-24.
WHEAT
After USDA's Small Grains Summary on Sept. 29, it is clear USDA will have a new U.S. wheat production estimate of 1.812 bb, up from its estimate of 1.734 bb in September. Much of the increase came from a 55-mb increase in the estimate of other spring wheat production, now seen at 505 mb. Dow Jones' survey of analysts expects USDA to increase its estimate of U.S. ending wheat stocks from 615 mb to 646 mb, but an even higher estimate is possible, as wheat export commitments in the new season are down 14% from a year ago.
USDA's estimate of world ending wheat stocks will likely get attention, as this is the time of year when southern crops are becoming more popular and northern producers are planting winter wheat. Dow Jones expects USDA to slightly increase its estimate of world ending wheat stocks for 2023-24 from 258.61 mmt to 258.80 mmt. Argentina and Australia are both contending with dry weather, and USDA's 85.0-mmt estimate for Russia looks too low, compared to other estimates. Big changes are not expected this month, but we can never rule out a surprise.
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Join us for DTN's webinar at 12:30 p.m. CDT on Thursday as we go through the numbers and discuss what the latest estimates mean. Questions are welcome, and registrants will receive a link later for viewing at their convenience. Register here for Thursday's October WASDE report webinar: https://www.dtn.com/….
| U.S. PRODUCTION (Million Bushels) 2023-24 | ||||||
| Oct | Avg | High | Low | Sep | 2022-23 | |
| Corn | 15,100 | 15,284 | 14,950 | 15,134 | 13,730 | |
| Soybeans | 4,132 | 4,204 | 4,079 | 4,146 | 4,276 | |
| U.S. AVERAGE YIELD (Bushels Per Acre) 2023-24 (WASDE) | ||||||
| Oct | Avg | High | Low | Sep | 2022-23 | |
| Corn | 173.5 | 175.5 | 172.0 | 173.8 | 173.3 | |
| Soybeans | 49.9 | 50.8 | 49.3 | 50.1 | 49.5 | |
| U.S. HARVESTED ACRES (Million Acres) 2023-24 | ||||||
| Oct | Avg | High | Low | Sep | 2022-23 | |
| Corn | 86.7 | 87.1 | 82.1 | 87.1 | 79.2 | |
| Soybeans | 82.8 | 82.8 | 82.5 | 82.8 | 86.3 | |
| U.S. ENDING STOCKS (Million Bushels) 2023-24 | ||||||
| Oct | Avg | High | Low | Sep | ||
| Corn | 2,145 | 2,389 | 1,926 | 2,221 | ||
| Soybeans | 236 | 267 | 200 | 220 | ||
| Wheat | 646 | 688 | 582 | 615 | ||
| WORLD ENDING STOCKS (million metric tons) 2022-23 | ||||||
| Oct | Avg | High | Low | Sep | ||
| Corn | 298.4 | 301.0 | 295.3 | 299.5 | ||
| Soybeans | 103.3 | 104.0 | 102.6 | 103.0 | ||
| Wheat | 267.1 | 267.4 | 267.0 | 267.1 | ||
| WORLD ENDING STOCKS (million metric tons) 2023-24 | ||||||
| Oct | Avg | High | Low | Sep | ||
| Corn | 313.0 | 318.4 | 309.0 | 314.0 | ||
| Soybeans | 119.6 | 122.0 | 116.3 | 119.3 | ||
| Wheat | 258.8 | 261.0 | 257.0 | 258.6 | ||
Todd Hultman can be reached at todd.hultman@dtn.com
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