USDA Reports Preview
March WASDE Offers Updates on Demand, South American Estimates
USDA's March World Agricultural Supply and Demand Estimates (WASDE) report may adjust some U.S. export estimates and should lower USDA's high production estimates for Brazil's corn and soybeans, but may not offer many changes, otherwise. The report will be released at 11 a.m. CST on Friday.
CORN
As we approach Friday's WASDE report, corn prices remain under extreme bearish pressure, not just from this season's more plentiful U.S. supplies, but also from the anticipation of more corn eventually coming from Argentina in May and Brazil in July. If there is good news for corn, it is that demand has been active. U.S. export shipments are up 34% in 2023-24 from this time a year ago. Ethanol production is up 4.5% from last year's pace at this time. Cattle numbers are down this year, but the Feb. 1 on-feed total is similar to a year ago at this time.
With all that going on, Dow Jones' survey of 18 analysts expects USDA to slightly reduce its estimate of U.S. ending corn stocks from 2.172 billion bushels (bb) to 2.141 bb, still the most in five years. South American crop estimates will get hard looks, as USDA's production estimates for corn and soybeans are higher than almost everyone else's. For Brazil corn production, Dow Jones expects USDA's estimate to be lowered from 124.0 million metric tons (mmt) to 122.4 mmt, or 4.82 bb. Conab's estimate is more credible at 113.7 mmt, or 4.48 bb, down 17% from last year's record crop.
For Argentina, USDA is expected to keep its corn production estimate at 55.0 mmt, or 2.17 bb, up 57% from last year's drought-restricted crop. Dow Jones expects USDA's estimate of world ending corn stocks to be trimmed from 322.06 mmt to 320.70 mmt, or 12.63 bb, the most in five years.
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SOYBEANS
Last month, I said the arrival of 2024 brought a bearish slap in the face to soybean prices, and sorry to say, but the slaps keep coming. May soybean prices have been challenging their 2023 low of $11.50 3/4 and appear to be losing the battle for support as USDA's ending stocks estimates for soybeans have climbed from 220 million bushels (mb) in October to 315 mb in February. The same ending stocks could be raised even higher on Friday, thanks to soybeans' slower-than-expected export pace in 2023-24. Dow Jones' survey expects USDA to slightly increase U.S. ending stocks from 315 mb to 319 mb. However, with 2023-24 exports running 11% below a year ago at this time, a 25-mb reduction in the export estimate would be reasonable.
As with corn, there will be a lot of attention on USDA's soybean production estimates for Brazil and Argentina. USDA's current estimate of 156.0 mmt for Brazil is too high, and Dow Jones expects it to be lowered to 152.5 mmt, or 5.60 bb. Conab's estimate of Brazil's soybean production was placed at 149.4 mmt, or 5.49 bb, last month and will get another update on Tuesday, March 12. For Argentina, Dow Jones expects a tiny increase, from 50.0 mmt to 50.2 mmt, or 1.84 bb, roughly twice last year's production. USDA's snapshot estimate of world soybean stocks is expected to be reduced from 116.03 mmt to 114.5 mmt, or 4.21 bb, still a record high, if true.
WHEAT
USDA's current estimate of 658 mb of U.S. ending wheat stocks for 2023-24 is expected to stay unchanged Friday, says Dow Jones' survey. If true, it will remain the second-lowest total in 10 years. With U.S. wheat export shipments currently down 11% in 2023-24 from a year ago at this time, USDA's 725 mb export estimate is already the lowest in over 50 years but may have to be trimmed further.
Dow Jones also expects USDA to slightly lower its estimate of world ending wheat stocks from 259.44 mmt to 259.10 mmt, or 9.52 bb, the lowest in eight years. In any other time, we would expect decent wheat prices with supply levels that low, but not in 2023-24, as Russia has come to dominate world wheat exports and is suppressing world prices. Friday's estimates may show a slight increase for Australia's wheat production after the Australian government just estimated a 26.0 mmt wheat crop on Monday. USDA won't have new wheat estimates for 2024-25 until the May WASDE report, but at the Ag Forum last month, USDA estimated U.S. ending wheat stocks will increase to 769 mb in 2024-25, the highest in four years, if true.
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Join us for DTN's webinar at 12:30 p.m. CST Friday, March 8, as we point out USDA's new numbers and add our own market comments. Questions are welcome, and registrants will receive a replay link for viewing at their convenience. Register here for Friday's March WASDE report webinar: https://www.dtn.com/….
| WORLD PRODUCTION (million metric tons) 2023-24 | ||||||
| Mar | Avg | High | Low | Feb | 2022-23 | |
| CORN | ||||||
| Argentina | 55.0 | 57.0 | 54.0 | 55.0 | 35.0 | |
| Brazil | 122.4 | 125.0 | 118.0 | 124.0 | 137.0 | |
| SOYBEANS | ||||||
| Argentina | 50.2 | 52.0 | 49.5 | 50.0 | 25.0 | |
| Brazil | 152.5 | 156.0 | 148.0 | 156.0 | 162.0 | |
| U.S. ENDING STOCKS (Million Bushels) 2023-24 | ||||||
| Mar | Avg | High | Low | Feb | 2022-23 | |
| Corn | 2,141 | 2,172 | 2,075 | 2,172 | 1,360 | |
| Soybeans | 319 | 355 | 293 | 315 | 264 | |
| Wheat | 658 | 682 | 648 | 658 | 570 | |
| WORLD ENDING STOCKS (million metric tons) 2023-24 | ||||||
| Mar | Avg | High | Low | Feb | 2022-23 | |
| Corn | 320.7 | 323.2 | 317.0 | 322.1 | 300.3 | |
| Soybeans | 114.5 | 117.0 | 111.0 | 116.0 | 101.9 | |
| Wheat | 259.1 | 260.2 | 257.0 | 259.4 | 271.2 | |
Todd Hultman can be reached at todd.hultman@dtn.com
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