Market News & Headlines >> June USDA Report Has View Surprises, Adds To Pressure On Wheat

 USDA’s June supply and demand report was mostly unremarkable, with corn and soybean estimates mostly coming in near expectations while world wheat estimates were bearish for a third straight month.

Accordingly the market has not had much of a reaction in the wake of the report. Here is a rundown of key estimates:

CORN: USDA left the U.S. corn balance sheet unchanged from a month ago. Its estimated 2013-14 carryout of 1.146 billion bushels was below the average analyst survey guess of 1.170 billion, while USDA’s new crop carryout estimate of 1.726 billion was up slightly from the average trade guess of 1.716 billion.

On the world balance sheet, USDA raised its old crop carryout estimate to 169.05 MMT, up from 168.42 MMT last month and up from the average trade estimate of 168.35 MMT. New crop world carryout is projected at 182.65 MMT, up from 181.73 MMT last month and the average analyst estimate of 181.52 MMT.


SOYBEANS: USDA’s U.S. estimates came in as expected, as it cut the old crop carryout to 125 million bushels, down from 130 last month and the average trade guess of 127 million. New crop soybean ending stocks are estimated at 325 million bushels, down from 330 million last month but above the average analyst estimate of 319 million.

World soybean projections were a little negative for prices. USDA’s old crop ending stocks forecast of 67.17 MMT was up slightly from last month’s 66.98 MMT and above the consensus analyst estimate of 66.43 MMT. New crop ending stocks are forecast at 82.88 MMT, up from 82.23 MMT last month and the average analyst estimate of 81.97 MMT.


WHEAT: As has been the case recently, USDA’s world wheat projections were bearish versus market expectations. World ending stocks of 186.05 MMT for 2013-14 are down from 186.53 MMT a month ago but near the average trade guess of 186.15 MMT. That reduction was more than offset by USDA’s new crop carryout projection of 188.61 MMT, up from the average trade estimate of 187.0 MMT and last month’s USDA estimate of 187.42 MMT. USDA raised crop forecasts for several countries.

USDA’s new crop U.S. wheat carryout estimate was also negative at 574 million bushels, up from 540 last month and the average analyst estimate of 552 million. Old crop ending stocks were raised by 10 million bushels, in line with expectations.

The U.S. winter wheat crop is estimated at 1.381 billion bushels, down from the average analyst estimate of 1.394 billion and last month’s forecast of 1.403 billion. Hard red winter wheat production of 720 million bushels was 13 million below the average trade guess.

COTTON: USDA tightened its old crop balance sheet and increased its U.S. crop outlook, but in each case not as much as many traders were expecting. USDA forecast old crop ending stocks of 2.7 million bales, down from 2.8 million last month but still above the 2.5 million USDA had estimated in April.

U.S. cotton production for 2014-15 was increased to 15 million bales, up from 14.5 million, but below most trade expectations given the badly needed, soaking rains that have fallen on Texas in recent weeks.

New crop U.S. cotton ending stocks are forecast at 4.3 million, up from 3.9 million last month.