USDA 2024 Commodity Outlook

WASHINGTON (DTN) -- USDA sees farmers planting 91 million acres (ma) of corn, 87.5 ma of soybeans and 47 ma of wheat in 2024, according to a Commodity Outlook report released in conjunction with the USDA Agricultural Outlook Forum.

Overall, the agency sees total acreage for the three crops declining 1% to 225.5 million acres, reflecting lower prices and "a reversion to a more typical level of prevent plant acres."

"Overall, USDA's early estimates of U.S. balance sheets for corn, soybeans and wheat were generally as expected," DTN Lead Analyst Todd Hultman said. "Today's new-crop estimates from USDA add to the bearish outlook for prices in 2024, but it is important to remember each new season comes with its own surprises and we will continue to report on the twists and turns of how 2024 actually turns out."

While growers are looking at lower input costs than last year, most notably in fertilizer and fuel, the report notes headwinds from interest rates and higher commodity prices.

It's the agency's first estimate of crops that, in the case of corn, soybeans, and spring wheat, have not been planted yet. It will next update these estimates in May 2024. Winter wheat planting estimates will updated before then.

CORN

For the 2024-25 marketing year, USDA's outlook is for lower production, greater domestic use, increased exports, and higher ending stocks.

Overall, it anticipates farmers will produce 15.040 billion bushels (bb) in the upcoming crop year, using a planting estimate of 91 million acres and trend-adjusted yield estimate of 181 bushels per acre (bpa). Including higher beginning stocks from 2023's surprisingly large crop, total supplies are forecast at 17.237 bb.

As is typical in years with higher supplies, USDA sees greater use. Food, seed and industrial use is forecast at 6.805 bb, with corn for ethanol production estimated at 5.4 bb, "based on expectations of modestly higher motor gasoline consumption and continued strength in ethanol exports."

Feed and residual use is also expected to climb about 1% to 5.75 bb, while exports are forecast to be up 50 mb to 2.15 bb "on expectations of modest global trade growth."

That puts ending stocks at 2.532 bb, 360 million bushels (mb) higher than the 2023-24. The stocks-to-use ratio is expected to climb to 17.2%, which would be the highest since 2005-6 if realized.

The season-average corn price received by producers is forecast down 40 cents to $4.40 per bushel.

Hultman said Thursday's estimates for corn production were a little less than he expected.

"But there is plenty of time for those estimates to change. USDA's estimate of 2.532 billion bushels of ending stocks, if true, would be the most since the 1987-88 season and would likely put corn prices below USDA's average farm price estimate of $4.40 a bushel."

SOYBEANS

USDA's outlook for soybeans calls for higher supplies, use and ending stocks, a recipe for lower prices.

Supplies are forecast to climb 8% above 2023-24 with increased beginning stocks and production. USDA anticipates farmers will produce 4.5 bb, up 8% year-over-year, assuming a weather-adjusted trend yield of 52 bpa and a 4.2 million acre increase in harvested area from 2023-24.

As U.S. crush capacity expands, USDA sees domestic crush climbing to a record 2.4 bb. "Reduced soybean meal prices will likely make soybean meal a more competitive feed ingredient and may prompt stronger demand in the global livestock and poultry sectors after several years of high prices," the report notes. Soybean meal exports are also forecast to set new records.

Renewable diesel will continue to drive soybean oil demand, with soybean oil for biofuel expected to grow by 8% to 14 billion pounds.

Soybean exports are also forecast to climb in 2024-25 by 155 mb to 1.875 bb.

"Large global supplies are likely to lead to lower soybean prices, spurring international demand, but the U.S. share of exports is expected to remain below 30 percent of global exports (compared to near 40 percent during 2013/14 to 2017/18) due to higher South American supplies," the report states.

Ending stocks for 2024-25 are projected at 435 mb, up 120 mb from the 2023-24 season. That would put the ending stocks-to-use ratio at nearly 10%, the highest since 2019-20. The season-average farm price is projected at $11.20 per bushel, down $1.45 from 2023-24.

"The early estimate is a reasonable start for a season we don't know much about, but the estimate will be challenged this spring," DTN's Hultman said. "It remains to be seen if farmers will increase soybean plantings from 83.6 million in 2023 to 87.5 million acres of soybeans without much incentive."

WHEAT

USDA sees increased supplies, larger total use and higher ending stocks of wheat in 2024-25.

Wheat production is expected to be 5% above 2023-24 at 1.9 bb and would be the highest in five years.

The NASS Winter Wheat and Canola Seedings report estimated winter wheat plantings at 34.4 million acres. Combined spring and durum wheat acres are forecast to be slightly lower than last year as soybeans, minor oilseeds and other crops appear to be more profitable for growers in the Northern Plains. Overall wheat planted area is forecast at 47 million acres, with 38.4 million acres likely to be harvested. The average yield is estimated to climb 2% to 49.5 bushels per acre.

After six years of declining beginning stocks, USDA sees supplies beginning the year at 658 million bushels. Combined with a larger crop, total supplies are forecast at 2.678 billion bushels.

Total use is forecast at 1.909 bb, up 2% from 2023-24 but still below the five-year average. USDA says domestic use will be moderately lower, as cheaper and abundant corn takes up a larger share of feed rations. Food use is projected at 962 million bushels, while exports are expected to rebound from last year's 52-year low to 775 mb.

Ending stocks are raised to 769 million bushels, 17% higher than 2023-24, with a stocks-to-use ratio of 40.3%. The season-average farm price is forecast at $6 per bushel, down $1.20 from 2023-24.

"The resulting average farm price of $6.00 for 2024-25 reflects the current state of depressed wheat prices worldwide and this report reinforces another tough year ahead for wheat growers," Hultman said. "Given the improved soil moisture we have seen over winter, there is room for a little higher yield than USDA expects."

Katie Dehlinger can be reached at katie.dehlinger@dtn.com

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