AM Comments 8/12/15
Wednesday, August 12, 2015, 8:08 AM
Submitted by: Eric Kist
Another USDA report day is upon us! At 11 AM this morning the USDA will release its monthly Supply and Demand report, showing updated numbers as we are steadily closing in on the end of the 2014/15 crop year.
Prior to today, the past two days of trading have featured 20-30 cent gains on Monday, only to retract yesterday and give up 13-20 cents, as traders have been positioning themselves ahead of the report and reacting to new weather forecasts. The general consensus in the market regarding today’s report is a feeling that both corn and soybean carryouts from the 14/15 crop year will shrink, and also that corn and soybean production estimates for the upcoming harvest will decrease from the USDA’s July report.
As you can see below, market analysts are expecting corn production estimates to be lowered due to lower yields and a slightly lower number of harvested acres, and also are expecting soybean production estimates to shrink on a lower yield projection and a drop in harvested ground of nearly 1.2 million acres.
This month’s carryout projections are also expected to shrink a touch from July’s estimates, as the average guesses for the corn ending stocks number is projected to be 1.774 billion bushels (down from 1.779 bb in July), and the soybean ending stocks number is projected to be 247 million bushels (down from 255 mb in July).
As always, it is anticipated that all of this information has been incorporated into the market already, so if we see any deviation from the average estimates one way or the other we can expect to see some fireworks in the markets.
Corn steady to 2 cents higher
Soybeans steady to 2 cents lower
Have a great day!