Carl German, Extension Crops Marketing Specialist; firstname.lastname@example.org
Prospective Plantings and Quarterly Grain Stocks Released
USDA’s Prospective Plantings and Quarterly Grain Stocks reports were released this week on Tuesday, March 31. Since the release of those reports the markets have reacted in a mixed fashion, up one day and down the next. Overnight energy and grain prices on the CME Group were higher and the dollar trader lower, pointing toward the possibility of higher prices being bid into these markets through the end of the week. At this point in time, with the carry of U.S. corn stocks that are anticipated and the prospective acreage of soybeans, it is likely to take a weather problem before prices could advance to much higher levels.
U.S. corn planted acres are projected at 85.0 million acres, one million acres less than last year. That level of planted acreage would result in approximately 77.7 million acres harvested. At last year’s yield of 153.9 bushels per acre the crop size for the ’09 crop could equate to 11.958 or almost 12 billion bushels. At last year’s total U.S. corn use, the carry into ’09/’10 marketing year would equal nearly 1.6 to 1.7 billion bushels. The season average corn price would be expected to range from $3.90 to $4.30 per bushel.
March 1 corn stocks totaled 6.958 billion bushels, 99 million bushels larger than a year ago.
U.S. soybean planted acres are projected at 76 million acres, 300,000 acres more than last year. From that level of plantings we could see an estimated 74.936 million acres of soybeans harvested. Total U.S. soybean production would then be estimated in the vicinity of 2.967 billion bushels, using last year’s yield of 39.6 bushels per acre. Last year’s U.S. soybean crop produced 2.959 billion bushels. The preliminary estimate for ’09 soybean production would not increase U.S. soybean stocks that much and with strong demand, might not be that indicative of an increase in U.S. soybean stocks for the ’09/’10 marketing year. However, there does seem to be a catch and that is the possibility of a wet spring occurring in portions of the U.S. The wet spring could cause a shift from corn that could increase soybean acres.
March 1 soybean stocks totaled 1.302 billion bushels, compared to 1.434 billion bushels last year. March 1 soybean stocks are 132 million bushels larger than a year ago.
U.S. prospective plantings for all wheat totaled 58.6 million acres, 4.5 million acres less than last year. Harvested wheat acres, estimated at 51.2 million acres, equates to an estimated production of 2.299 billion bushels for ’09 production, as compared to 2.5 billion bushels last year, reflecting a decrease in production of 201 million bushels. With production projected at 2.299 billion bushels, carry-over stocks at 712 million bushels, and total use of 2.213 billion bushels for the current marketing year we are likely to see an increase in wheat ending stocks.
March 1 wheat stocks were estimated at 1.037 billion bushels, compared to 709 million bushels a year ago. March 1 wheat stocks are 328 million bushels larger than last year.
March 1 stocks are indicative that we are likely to see an increase in USDA’s projections in the ending stock numbers for U.S. corn, soybeans, and wheat in the April supply and demand report. That would suggest that we are not likely to see nor should we expect large price increases from current levels in the near term. On a positive note, the weakening dollar can help to bolster the outlook for U.S. exports. The dollar is currently trading six points lower and the price of crude is $3.00 per barrel lower than recent highs. Dec ’09 corn futures are currently trading at $4.35 per bushel; Nov ’09 soybeans at $9.22; and July ’09 SRW wheat futures are $5.59 per bushel.
For technical assistance on making grain marketing decisions contact Carl L. German, Extension Crops Marketing Specialist.