Expectations for this report are all in the same direction: Higher than last year. Given we began the marketing year with bigger supplies that is no surprise. The range in pre-report guesses is greatest for corn, at 341 million bushels and least for wheat, at 117. The average estimates reflect strongest growth in soybean stocks, at almost 36% over last year, while corn would be up 8.6% and wheat, “just” 8%.
The biggest potential for a surprise in this report may be in soybeans. Farmers are more inclined to sell beans at harvest and hold corn. At the same time, some elevators are reporting stocks at or below year-ago levels—plausible since exports have been strong and now equal USDA’s projection for the year. Strengthening basis would support this view.
Not only will the report be “read” for its implications of usage during the second quarter of the marketing year, but whose hands the stocks are in (are farmers really in the drivers’ seat?) and state/regional locations will be important.
It will be interesting to see how the market balances the acres report and the stocks report.
I’ll follow up on those features tomorrow evening.