USDA’s quarterly Grain Stocks report was mildly supportive for corn and soybeans, said Jerry Gulke, president of The Gulke Group, on a Farm Journal Radio special report Wednesday.
“It was about as expected in the corn carryover,” Gulke said, pointing out that while corn stocks were lowered by about 9 million bushels, the 2014-2015 carryout of 1.731 billion bushels is still more than last year’s stocks of 1.732 billion bushels. In the September World Agricultural Supply and Demand Estimates report, corn ending stocks were projected to be 1.732 billion bushels.
Soybean stocks, meanwhile, were lowered to about 191 million bushels when the trade expected 205 million bushels, he added. In the September WASDE report, USDA projected 2014-2015 soybean ending stocks at 210 million bushels.
Looking deeper into the numbers behind the reduction in soybean stocks, Gulke noted that USDA dropped last year’s soybean yield slightly, which could imply a smaller soybean yield in the current marketing year.
“They lowered the yield in beans by about three-tenths of a bushel. That’s their only excuse,” Gulke said. “Where did this stuff disappear? We know what we exported, we know what we crushed, and yet we don’t have as many beans left over. What happened? Well apparently, we had a little bit less of a yield than we thought. So, things weren’t as good as last year as we thought, which leads you to suspect --and the traders, perhaps--that this year might not be as good as we thought because we’re just kind of below last year’s yield, and we had a pretty good bean yield last year.”
Listen to Jerry Gulke's full comments here:
Meanwhile, USDA reported all-wheat stocks at 2.089 billion bushels compared to 1.907 billion a year ago, but the reported figure was below expectations of 2.149 billion bushels, Gulke pointed out.
While USDA’s quarterly stocks report brought no major surprises, the report showed cracks in the bearish argument for corn and soybeans, according to
The important fact, he stressed, was that corn and soybean stocks got smaller instead of bigger. “It could have been worse,” he added. “We could have found another 50 million bushels of beans and 100 million bushels of corn.”
What do you think of today's grain stocks numbers? Do you see them as bearish or bullish for corn and soybean prices? Let us know in the comments.