Fundamentally Speaking

In February, the USDA at its annual Ag Outlook (AO) session projected that U.S. corn use for the coming year in 2025/26 would be record high at 15.185 billion bushels (bb).

They also estimated production for the coming year also at a new high of 15.585 bb resulting in an increase in ending stocks to 1.965 bb vs. the current 1.465 bb.

This works out to a projected 12.9% stocks-to-use ratio.

The USDA also projected the new crop U.S. soybean stocks-to-use ratio at 7.2% vs the current 8.6% ratio for the 2024/25 marketing year.

The first official stocks-to-use ratios for U.S. corn and soybeans will come next month when the USDA issues the first WASDE report for the 2025/26 season.

This chart looks at the stocks-to-use ratios for both corn and soybeans given at the USDA Ag Outlook session and then compares them to the ones furnished in the May WASDE report.

Over the past 25 years the average change has been a 0.1% increase in the corn stocks-to-use ratios and no change for soybeans, but over the years there have been some significant changes in the stocks-to-use ratios given in late February at the Ag Outlook and then about ten weeks later when the first new crop WASDE figures are released in May.

Last year the USDA 2024 Ag Outlook stocks-to-use ratio for corn was 17.2%, but in the May 2024 WASDE it was down to 14.2% while the Ag Outlook 2024 soybean stocks-to-use ratio was 9.9%, increasing to 10.2% in the May 2024 WASDE.

What can change over the ten weeks to result in a different stocks-to-use ratio is a higher or lower beginning stocks figure based on demand changes in the March and April WASDE reports and more likely, a far different new crop plantings figure in the March intentions report than the ones used by the USDA in its Ag Outlook calculations.

In years 2006, 2009, 2018, and 2022, the May WASDE corn stocks-to-use ratio was quite a bit lower than given in the Feb Ag Outlook sessions due to a March corn planting figure well below what the USDA had projected in February.

Similarly, a corn stocks-to-use figure significantly higher in the May WASDE as opposed to the Feb Ag Outlook is often due to a March prospective plantings figure quite a bit above what the USDA had estimated in February.

A similar pattern is seen in soybeans, but not to the degree in corn, with soybean changes more linked to a change in beginning stocks.

This year the March 2025 corn intentions figure came in 1.326 million acres, above the 94 million the USDA had projected at the Ag Outlook session with soybean planted area just 0.240 million lower.

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