Market News & Headlines >> USDA Sees Corn, Soy Supplies Swelling In 2014-15

USDA’s May supply and demand domestic carryout estimates were generally friendly for old crop corn, wheat and soybeans, but both world ending stocks projections and new crop forecasts were bearish.

CORN: Ending stocks for 2013-14 are now projected at 1.146 billion bushels, down from 1.331 billion last month and the average trade estimate of 1.314 billion. Behind the reduction is a 150-million bushel hike in export demand, to 1.9 billion. New crop U.S. carryout is projected at 1.726 billion bushels, up a little from the average trade estimate of 1.672 billion.

However, world ending stocks projections were quite bearish for both old and new crop. USDA projected old crop world carryout of 168.42 MMT, up more than 10 MMT from last month and well above the average trade estimate of 157.31 MMT. New crop was even more bearish, as USDA sees a carryout of 181.73 MMT for 2014-15. Analyst estimates had ranged from 149.9 to 175 MMT.

SOYBEANS: The trend was similar for soybeans. Old crop carryout was cut by 5 million bushels to 130 million, versus analyst expectations of 134 million, whereas new crop carryout of 330 million bushels was well above the average trade estimate of 307 million.

On the world balance sheet, USDA forecast old crop ending stocks of 66.98 MMT, below 69.42 MMT and the average analyst estimate of 69.77 MMT, while new crop ending stocks of 82.23 MMT came in above the survey consensus of 80.34 MMT.

WHEAT: USDA’s forecasts for wheat were more in line with expectations. It left old crop U.S. carryout unchanged at 583 million bushels and lowered the world carryout very slightly to 186.53 MMT, versus an average trade estimate of 185.95 MMT.

USDA projected global ending stocks for 2014-15 wheat at 187.42 MMT, up from the average analyst estimate of 184.53 MMT.

Winter wheat production estimates were a little below expectations. USDA estimated the hard red winter wheat crop at 746 million bushels, down from the average analyst estimate of 782 million, and forecast the soft red winter crop at 447 million bushels, 20 million below expectations.

COTTON: U.S. old crop cotton carryout had been declining but USDA reversed that trend Friday, upping ending stocks to 2.8 million bales, up from 2.5 million last month, on reduced export sales. Ending stocks are expected to balloon in 2014-15, with USDA forecasting U.S. new crop carryout of 3.9 million bales as Chinese imports drop by a third. That would be a stocks/use ratio of 29%, in line with the 10-year average, according to USDA.

New crop world ending stocks are forecast at 102 million bales, which would be a fourth consecutive record.