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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.

USDA Reports Tighter Ending Stocks - Grains Trade Lower

Dec 10, 2013

Grains are trading lower after today’s USDA report, with corn down 7 cents, soybeans off 5 and Chicago wheat down 12 cents. Production estimates were left unchanged in today’s report as demand estimates drove ending stock changes. Compared to trade estimates, ending stocks came out lower than expected for corn, soybeans, and wheat. The negative reaction today's numbers raises questions if the corn and soybean market is losing steam after recent positive price action.

2013/14 U.S. Ending Stocks Expected Reported
Corn 1,871 1,792
Soybeans 153 150
Wheat 540 575

 

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U.S. Corn ending stocks came in lower than expected in this report as demand side revisions were larger than anticipated. Exports were raised 50 million bushels, ethanol usage was up 50 million bushels. On net, the USDA lowered projected ending stocks for 2013/14 by 95 million bushels to 1,792 million bushels.

Soybean ending stocks were reported in-line with trade expectations, reflecting much tighter stocks than projected in the November report. With ending stocks projected at 150 million bushels, stocks to use for 2013/14 are now projected at just 4.5%. Exports were raised by 25 million bushels, crushing was raised 5 million bushels, and imports were raised by 10 million bushels.

 2013/14 World Stocks

Expected

Reported

Corn

163.30

164.33

Soybeans

71.64

70.23

Wheat

179.11

178.48

 

Corn and wheat world ending stocks both came out lower than trade expectations. Soybean world ending stocks were the major focus of today’s report with many analysts projecting larger world ending stocks. The USDA left Brazilian production unchanged at 88.00 million tonnes, helping to keep a lid on projected world stocks.

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