Market News & Headlines >> USDA Forecasts Record Corn, Soybean Crops

USDA projected record U.S. corn and soybean crops in its August crop report, although its corn crop estimate came in below expectations.

CORN: USDA projected a corn crop of 14.032 million bushels, up from a July estimate of 13.86 million but below the average analyst estimate of 14.253 million. The projected yield of 167 bushels per acre fell short of the average trade estimate of 170.1 bushels and was below the low range of analyst guesses.

The smaller than expected crop forecast resulted in a smaller ending stocks projection for 2014-15 at 1.808 MMT, down from an average analyst estimate of 2.005 million. Last month’s estimate was 1.801 million. USDA lowered its 2013-14 corn carryout estimate to 1.181 million, versus an average trade guess of 1.240 million.

The USDA’s corn crop estimate also kept projected 2014-15 world carryout lower than expected at 187.82 MMT, down slightly from a month ago and below the average analyst estimate of 192.53 MMT. Old crop world corn carryout is estimated at 171.09 MMT, down from a July estimate of 173.42 MMT and nearly 2 MMT below trade expectations.

SOYBEANS: USDA estimated the soybean crop at 3.816 billion bushels, close to the average analyst estimate of 3.823 billion and up slightly from 3.8 billion last month. The yield is projected at 45.4 bushels per acre. New crop ending stocks for soybeans are forecast at 430 million bushels, above the average trade estimate of 414 million and up from a July forecast of 415 million.

World soybean ending stocks were close to expectations for both old crop and new crop at 67.09 MMT and 85.62 MMT respectively.

WHEAT: USDA’s winter wheat crop projections were slightly above trade expectations: The hard red winter crop is seen at 729 million bushels, up from a July estimate of 703 million and the average trade estimate of 707 million, thanks to strong yields in northern growing areas; The soft red winter crop was estimated at 466 million, up eight million from last month and five million above the average trade estimate. The spring wheat crop is estimated at 572 million, up from 565 million last month but below the average trade guess of 579 million.

On the global front, USDA sees world old crop wheat carryout of 183.66 MMT, down from 184.29 MMT last month. New crop carryout of 192.96 MMT is up more than 3 MMT from last month and above the average trade estimate of 190.41 MMT, due to increased production. USDA upped its world wheat crop outlook for 2014-15 by 10.9 MMT, to 716.1 MMT, thanks to a 6 MMT increase in Russia along with increases in China and Ukraine.

COTTON:  USDA hiked its U.S. cotton crop projection by 1 million bales to 17.5 million, a bigger increase than generally expected. Ending stocks were raised to 5.6 million, up from 5.2 million last month, as the increase in production was partially offset by a 500,000-bale increase in projected exports. The carryout would put the stocks/use ratio at 39%, highest since 2007-08.