The USDA report was mostly bearish with a few surprises. Wheat took a good chunk out of ending stocks again by reducing EU, India and China down solidly (and Australia up). USDA left US wheat ending stocks unchanged. Corn saw global production and ending stocks down, and in particular we saw US corn yields down from the August estimate which took a good chunk out of US production – most of it expected though so market did not react much. Beans saw the biggest surprise with US yields up well more than most traders expected – and a resulting 3.8 MMt increase in US production.
WHEAT BULLISH – CBOT SRW DEC UP 5.80 USc/bu
- World production for 16/17 UP 4MMt. EU (2.2MMt) & China (2MMt) both DOWN. Kazak (1.5MMt), Russia (7MMt) Aus (1MMt) India (2MMt) all UP.
- World consumption UP 1MMt (Mostly India & Morocco.)
- World stocks-to-use ratio DOWN again to 33.81%. (Fourth downward revision in a row).
BARLEY BULLISH
- World production DOWN 5MMt (Mainly EU & Russia).
- World demand UP 13MMt.
- World stocks DOWN25MMt.
- World stocks-to-use ratio DOWN 19 points to 15.92%
CORN NEUTRAL to BULLISH – CBOT Corn DEC DOWN 1.60 USc/bu.
- World production DOWN 7MMt (Mostly China, U.S & EU)
- World demand DOWN5MMt (Mostly U.S & EU).
- World stocks DOWN4MMT.
- World stocks-to-use ratio DOWN 12 points to 21.59%.
SOYBEANS BEARISH – CBOT Soybeans NOV DOWN 16 USc/bu.
- World production UP12MMt (Majority US which is UP 3.8MMt).
- World demand DOWN1MMt.
- World stocks UP9MMt.
- Stocks-to-use ratio UP 42 points to 25.20%.
