WASDE: Corn Balance Sheets Remain Unchanged
Jun 12, 2012
The USDA projected corn balance sheets as unchanged in June, a slight surprise to analysts as they estimated a reduction in supplies due to dry weather in the corn belt. Soybean and wheat supplies were decreased slightly, in line with analysts' expectations. Today marked the first time the Chicago Board of Trade was open during the WASDE's 7:30AM CT release time.
Projected U.S. 2012/13 supplies, production, and use were unchanged this month. 2012/13 ending stocks remained at 1.88 billion bushels. The 2011/12 and 2012/13 projected range for season-average corn prices was unchanged and remain $5.95 to $6.25 and $4.20 to $5.00, respectively.
U.S. corn usage to produce ethanol in 2011/12 was projected 50 million bushels higher, reflecting recent ethanol trade and production data. Corn exports were projected to decline by 50 million bushels as sales and shipments fell below previous estimates. 2011/12 U.S. corn ending stocks remained at 851 million bushels.
Global coarse grain supplies in 2012/13 were estimated to increase 4.8 million tons due to increases in corn production and beginning stocks. 2012/13 global corn beginning stocks were increased by 1.6 million tons on higher production from Brazil and China in 2011/12.
The USDA's unchanged balance sheet for corn came as a surprise to analysts who predicted a decrease in supplies. We will keeping a close eye on the weather patterns in the Corn Belt as continuing drought would have an adverse effect on production and supply.
2011/12 U.S. soybean exports were increased this month by 20 million bushels due to increased global import demand. U.S. ending stocks for 2011/12 were estimated to decrease 35 million bushels to 175 million bushels.
U.S. soybean ending stocks for 2012/13 were projected at 140 million bushels, a five million bushel decrease from last month. Exports for 2012/13 were estimated 20 million bushels lower to 1.485 billion bushels due to decreased supplies. The 2012/13 average soybean price was unchanged at $12.00 to $14.00 per bushel.
We look forward to the acreage report that will be released later this month as we believe more soybeans will be planted due to the timely increases in soybean price and lack of available corn seed for re-planting.
U.S. wheat beginning stocks for 2012/13 were adjusted down by 40 million bushels due to increases in food usage and exports. The increased food usage reflects the North American Miller's Association's higher than expected flour milling during the January to March quarter.
U.S. wheat production for 2012/13 is estimated down 11 million bushels to 2.234 billion bushels based on lower production for winter wheat and dorum wheat. 2012/13 ending stocks were projected to decrease by 41 million bushels. The season average wheat price for 2012/13 was projected at $5.60 to $6.80 per bushel.
Global wheat supplies for 2012/13 were decreased by seven million tons. Global production for 2012/13 was lowered as there were reduced crop prospects for several exporting countries including Russia, U.S., EU-27 and Turkey.
The poor conditions of the U.S. corn crop reflected in the latest crop progress report were not taken into consideration in this report and we now expect major revisions in next month’s WASDE. The next major USDA report will be the quarterly acreage and grain stocks reports released at the end of the June.
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