I had to do some video for the folks at US Farm Report/Ag Day to recap the WASDE, I figured I would share it on the newsletter. I discuss the WASDE more in video but if you are looking for a short takeaway I would be bullish corn, bullish/neutral beans, neutral wheat and neutral new crop cotton while bearish new crop cotton.
My biggest takeaways came in new crop global ending stocks for corn, with trend yields and current S.Am production we are looking at a 10% decrease in ending stocks. This story may take a while in corn to play out but if you would drop a few acres off trend yields, you could see carryout in the US much lower and stocks to use ratio’s tighten. In beans, the carryout for US supplies and world supplies next year will fall as new demand hikes show up in the balance sheet. We are closer to a sub 400 million bean balance sheet than a +600 million which I think keeps bean prices in check. For wheat, lots of supply but it depends on how this crop year finishes out. Lastly, cotton…same story…big new crop acres trumps old crop demand/tightness.
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