USDA released the June 29 Acreage Report and Quarterly Grain Stocks Report Friday. Both of these reports are based on conditions as of June 1.
The reports have been called neutral to bullish for corn, neutral for cotton, bearish for soybeans and mixed for wheat. That said, there were no real surprises in the USDA reports and with the reports out of the way the market will turn its focus on the weather and the weakening U.S. Dollar.
Drought in the lower half to a third of the Midwest and the Mid-South continues to intensify with no real short-term relief in sight.
European leaders agreed to use bailout funds to aid banks and that saw a surge in the Euro and a weakening U.S. Dollar with the Dollar in early trading at 81.69, down 1.32.
Corn acreage at 96.4 million acres was 440,000 acres higher than the average trade guess and at the high end of estimates and 540,000 acres higher than the March 30 intentions. This would be the highest acreage since 1937.
More importantly, harvested acreage is estimated at 88.85 million acres, a little higher abandonment number than earlier thought and less than the 89.1 million acres that USDA has been using.
All cotton acreage at 12.6 million acres was 520,000 acres lower than the March 30 intentions, but was within the range of guesses.
Soybean acreage at 76.1 million acres was 505,000 acres more than the average trade guess and 2.18 million acres higher than the March 30 estimate. It would be the third highest on record.
All wheat acreage was at the low end of expectations and at 56.017 million acres were 830,000 lower than the average trade guess and 109,000 acres higher than the March 30 intentions.
These acreage numbers are the ones at least for now that the market will be trading. Acreage changes since June 1 have occurred, most likely in abandoned acres, but will not fully come to light until a firmer number comes probably in the September USDA report. Acreage then will be based from FSA certified acres as well as surveys.
There were no major surprises in the Quarterly Grains Stocks Report as it is called neutral to bullish for corn, bearish soybeans and neutral to bearish wheat.
Corn ending stocks were reported 33.5 million bushels lower than the average trade guess. Based on this stocks data, old crop ending stocks in the July report may be adjusted downward.
Soybean stocks were 27.5 million bushels higher than the average trade guess, and above the top end of expectations. Unless exports are increased in the July USDA report, old crop ending stocks reported in July could be around 200 million bushels.
Wheat stocks ended their marketing year at 742.7 million bushels, 14.7 million bushels higher than reported in June’s USDA Supply & Demand report and 16.7 million bushels higher than the average trade guess.
The next USDA Supply and Demand report will be released on Wednesday, July 11 and will update the fundamental numbers based on the Acreage Report and Quarterly Stocks Reports.