In their March 29 quarterly grain stock report USDA noted there’s more grain in storage than the market expected. USDA pegged corn stocks at 8.605 billion bushels, up from 2018 and roughly 2.5 million bushels more than the trade expected, according to a poll from Reuters. USDA pegged soybean stocks at 2.716 billion bushels (a record large number), compared to the average trade guess of 2.683 billion bushels. Wheat was more in line with trade expectations coming in at 1.591 billion bushels, compared to the trade guess of 1.555 billion bushels.
On-farm storage is where the surprises came for both corn and soybeans.
Ken Smithmier head of ag research at ClipperData tweeted “Corn on-farm stocks +3% while bean stocks +49% a head scratcher for me today.”
However, Angie Setzer of Citizens Grain LLC was quick to point out that this report is not reflective on grain stored on farms in Nebraska and Iowa that was damaged due to flooding.
Still the record large soybean stocks will not bode well for basis, Setzer says.
“If you're holding onto soybeans hoping for basis improvement, you probably shouldn't be holding your breath,” she says.
Excess corn, combined with an increase in estimated corn acres, sent the corn market diving following the report’s release on Friday. At report release, soybeans held their ground.
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