Market News & Headlines >> USDA Seen Cutting Corn Stocks, Raising Soy
The grain trade is looking for USDA to lower its forecast for U.S. corn ending stocks for this year and 2017/18 in Friday’s monthly supply/demand report, but expects a higher 2017/18 soybean carryout in the face of bumper South American production.
Trade estimates of the 2016-17 U.S. corn carryout average 2.284 million bushels in a range from 2.215-2.360 billion compared with USDA’s May forecast of 2.295 billion bushels, according to a Bloomberg News survey of 25 analysts. Pre-report expectations for the 2017/18 carryout average 2.072 billion bushels in a range from 1.840-2.235 billion, compared with USDA’s May forecast of 2.110 billion bushels.
Although the trade is expecting a further cut in the old-crop carryout, fading U.S. corn export sales are a negative indicator for old-crop usage. Competition from South American corn figures to remain stiff over the final quarter of the marketing year.
For the 2016/17 soybean carryout, trade estimates average 434 million bushels, just one million below USDA’s May forecast, in a range from 411-461 million bushels. Pre-report estimates of the 2017-18 U.S. soybean carryout average 513 million bushels, 33 million above USDA’s May forecast in a range from 458-668 million bushels.
USDA could raise its forecast for 2016/17 U.S. soybean exports, based on continued strong sales and shipments, but could cut its old-crop crush number after the April crush came in below a year earlier. Projected exports for next year could be lowered due to stiffer South American competition resulting from larger estimated South American production and ending stocks for 2016/17.
USDA is not expected to change its U.S. wheat carryout estimate significantly on Friday. Trade estimates of the 2016/17 U.S. wheat carryout average 1.158 billion bushels, 1 million below USDA’s May forecast, in a range from 1.140-1.177 billion. Pre-report estimates of the 2017/18 carryout average 910 million bushels, 4 million below USDA’s May forecast in a range from 860-995 million bushels.