For the week December and March corn were 3 cents lower, November soybeans gained 4 ¼, January soybeans rose 4, December soybean meal was $4.00 higher, December bean oil lost 14 points, December soft red winter wheat fell 4 ½, December hard red winter wheat lost 8 ½ and December hard red spring wheat was 8 lower.
Bearish Surprise in USDA Quarterly Stocks Report
USDA’s Quarterly Stocks Report on Tuesday provided a bearish surprise for the corn market.
The agency raised stocks to 1.532 billion bu. which was a 207 million bu. over their corn ending stocks projection of 1.325 billion bu. in the September WASDE.
Jerry Gulke, president of the Gulke Group says the report left a bearish corn inventory outlook.
“The 207 million bu. increase in carry-in to the 2024-25 marketing year increased new crop carryout to 2.317 billion bu. maybe even 2.5 billion bu. depending on their export estimate.”
Where Did All the Corn Come From?
Gulke says it shouldn’t have come as a shock as the debate over supply and demand the past 18 months was already contentious.
However, the quarterly stocks make the data driven reports all the more questionable and come at a terrible time for some farmers, adds Gulke.
“We were halfway expecting it because they had a huge number in there for this last marketing year for feed and residual. And we thought that they would trim that some,” he says.
Added to 2025-26 Corn Carryout
The debate over corn yield -- whether it is 188 bu. per acre, 186 or less --is a moot point say Gulke, as USDA found about 2 bu. per acre more already in the bin.
“So now the market will need to see a bigger reduction in 2025 corn yields just to get back to a 2.1 billion bu. carryout,” he explains.
November WASDE?
Gulke says with the government shutdown farmers may not see the shock this month with USDA delaying or even cancelling the October WASDE Report.
He isn’t sure it will even show up in the November WASDE.
“I think USDA could kick the can down the road until the December Quarterly Stocks Report to see just how much we have used in the last quarter of the year to be able to prove or disprove the feed and residual is as high as they think it is,” he says.
Until then the market will rely on private estimates according to Gulke.
Best Hope for a Corn Rally?
So, the best hope for a bigger rally in the corn market may be a South American weather problem.
“The reversal we saw in soybeans after the Trump talk with China excited the soybeans, but it didn’t do a lot for corn.So, we need another catalyst.
In the meantime, he says the government has elected to kick the can down the road regarding the benefits of tariffs for agriculture, if any, opting to send checks again to tide farmers over.
For more information you can contact Jerry at info@gulkegroup.com.
