Below are the July WASDE results and my updated Supply & Demand tables. You can also access the full report by clicking here.
The report was bullish for HRW wheat (KC). Russian wheat production was cut, US HRW exports were increased, and feed use was increased. Year-over-year HRW stocks are projected to be 15% lower. KC wheat finished 20 higher today and lead all markets.
Corn was up 8 and soybeans up 3. Old crop corn ending stocks are now 2.34 billion and could be closer to 2.5 billion when it is all said and done. US exports are being hurt by the his price of US corn combined with large global stocks. Wheat is also taking away feed demand for corn.
New crop corn yield was unchanged at 166 and acres were 91.7mm. Ending stocks are just over 2 billion. The market clearly does not believe this number or Dec Corn would be sub $4.00. Summer weather and speculation about the Aug WASDE will drive the markets between now and August 12th.
Soybean yields came down 1 bpa to 48.5 and acres were 80mm. Ending stocks are now 795mm. A lot better than 1 billion but still a large carryout number.
Corn S&D:
I think old crop ending stocks might reach 2.5 billion but I also think acres come down to 3 to 6mm and yield comes down 5 to 10bpa. Below are some scenarios. At 88.7mm acres and a 160 yield we have 1.3 billion ending stocks and we have some price rationing. At 85.7mm and a 155 yield we have significant price rationing. In the first scenario we probably make new highs and test $5. In the most bullish scenario we most likely trade through $5.
Soybeans S&D:
I want to believe soybean acres stay at 80mm but I can see them going higher by 1 or 2mm. Bean acres seem like such a wild card right now. I do think the yields are lower but we still have a lot of soybeans on the balance sheet. Ending stocks of 600mm to 800mm still argues for soybeans in low $9s to mid $8s. For soybeans to make a run at $10 we need to see 80mm acre (or lower) and a 45 national bpa (or lower)
WASDE Results:
U.S. Yield 2019/20
| USDA July | Avg. Trade Est. | Trade Range | USDA June Est. | |
| Corn | 166.0 | 165.0 | 162.0-167.0 | 166.00 |
| Soybeans | 48.5 | 48.6 | 47.0 – 51.0 | 49.5 |
U.S. Production 2019/20 (billion bushels)
| USDA July | Avg. Trade Est. | Trade Range | USDA June | |
| Corn | 13.875 | 13.664 | 13.100-13.960 | 13.68 |
| Soybeans | 3.845 | 3.833 | 3.783-4.100 | 4.15 |
U.S. Ending Stocks 2018/19 (billion bushels)
| USDA July | Avg. Trade Est. | Trade Range | USDA June Est. | |
| Corn | 2.340 | 2.211 | 2.065 – 2.385 | 2.195 |
| Soybeans | 1.050 | 1.053 | 0.935 – 1.137 | 1.070 |
| Wheat | 1.072 | 1.073 | 1.025 – 1.102 | 1.102 |
U.S. Ending Stocks 2019/20 (billion bushels)
| USDA July | Avg. Trade Est. | Trade Range | USDA June Est. | |
| Corn | 2.010 | 1.692 | 1.072 – 1.975 | 1.675 |
| Soybeans | 0.795 | 0.812 | 0.558 – 1.111 | 1.045 |
| Wheat | 1.000 | 1.043 | 950 – 1.092 | 1.072 |
US Wheat Production (billion bushels)
| USDA July | Avg. Trade Est. | Trade Range | Previous USDA | |
| All Wheat | 1.921 | 1.911 | 1.851 – 1.950 | 1.903 |
| Winter Wheat | 1.290 | 1.279 | 1.231 – 1.314 | 1.274 |
| HardRed Winter | 0.804 | 0.798 | 0.726 – 0.835 | 0.794 |
| Soft Red Winter | 0.259 | 0.257 | 0.240 – 0.297 | 0.258 |
| White Winter | 0.227 | 0.224 | 0.220 – 0.234 | 0.222 |
World Ending Stocks 2018/19 (million metric tons)
| USDA July | Avg. Trade Est. | Trade Range | USDA June Est. | |
| Corn | 328.75 | 327.3 | 322.7 – 355.7 | 325.38 |
| Soybeans | 112.98 | 113.0 | 111.6 – 117.6 | 112.80 |
| Wheat | 275.15 | 275.7 | 273.0 – 277.0 | 276.57 |
World Ending Stocks 2019/20 (million metric tons)
| USDA July | Avg. Trade Est. | Trade Range | USDA June Est. | |
| Corn | 298.92 | 291.7 | 282.40 – 300.00 | 290.52 |
| Soybeans | 104.53 | 109.6 | 103.00 – 124.10 | 112.66 |
| Wheat | 286.46 | 291.3 | 279.90 – 295.00 | 294.34 |
South American Production (million metric tons)
| USDA July | Avg. Trade Est. | Trade Range | USDA June Est. | |
| Brazil Corn | 101.0 | 99.86 | 96.0 – 101.00 | 101.0 |
| Brazil Soybeans | 117.0 | 117.22 | 116.0 – 118.50 | 117.0 |
| Argentina Corn | 51.0 | 49.28 | 48.00 – 50.00 | 49.0 |
| Argentina Soybeans | 56.0 | 56.09 | 55.50 – 57.00 | 56.0 |
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