Sep 22, 2014
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Grain Hedge

RSS By: Brock Schimbeno, AgWeb.com

Grain Hedge is a self-directed discount brokerage that saves farmers money when trading in the futures and options market. For $7 commissions per side producers can execute their marketing strategy with authority, any time the markets trade.

January USDA Report Reaction

Jan 10, 2014

January USDA Report Reaction - 11:40 AM Central Time

This morning's USDA report was bullish corn, neutral soybeans, and bearish wheat. At the the moment, corn is trading 15 cents higher, soybeans up 10 cents, and Chicago wheat is off 14 cents. The biggest early surprise was corn yield being lowered by 1.6 bushels per acre. Join us on GrainTV for a complete breakdown of today's numbers after the market close.

2013/14 US Ending Stocks (Million Bushels)

 
January
Expected
January
Reported
Corn 1,861
1,631
Soybeans
149
150
Wheat
557
608

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Corn ending stocks came in 230 million bushels below trade expectations at just 1.631 billion bushels. The crop production report provided an early surprise as corn yield was lowered 1.6 bushels per acre to a 158.8 national average.On net, production was lowered by 64 million bushels for the 2013/14 growing season. Helping to further reduce ending stocks was higher feed and residual usage of 100 million bushels and higher ethanol usage by 50 million bushels. South American production numbers were also supportive, as Argentina production was lowered by 1 million tonnes. All things considered, today's ending stocks number was well below trade expectations and should help keep corn prices in Chicago above $4.00 in the near term.

U.S. wheat ending stocks jumped 33 million bushels pushing prices lower following the report. The trade was expecting ending stocks to fall by 18 million bushels. With production numbers left unchanged and demand numbers revised lower, ending stocks did just the opposite. Demand numbers were revised lower by 34 million bushels due to a 60 million bushel revision lower in feed and residual and partially offset by a 25 million bushel increase in exports.  
Global ending stocks also increased by 1.5 million tonnes to 888.8 million with production increases in China and the Black Sea region. Argentina's wheat production was revised lower by .5 million tonnes with a lower expected harvested area.

Soybean ending stocks came out unchanged from the December report and 1 million bushel higher than trade estimates. 2013/14 production was raised by 0.3 bushels per acre to a 43.3 national average. Offsetting larger production was higher crushing by 10 million bushels and higher exports by 20 million bushels. South American production was bumped slightly higher by way of a 1 million tonnes increase to expected production out of Brazil.
 

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