The report on the quarterly grain stocks in the US led to a collapse of soybean prices by 3.5% and a rise in the price of wheat

USDA’s September 30 report on quarterly US grain stocks as of September 1 surprised market participants and led to a sharp jump in quotes. The new estimates of production and stocks will be reflected in the October WASDE supply and demand balance.

Compared to the September WASDE balance sheet , the corn production forecast in 2021/22 was reduced by 1.05 million tons to 382.8 million tons. Stocks of old crop corn on September 1 amounted to 35.05 million tons, which was 12% higher than on 1 September 2021, although analysts estimated it at 38.4 million tons.

December corn futures on the Chicago Mercantile Exchange were largely unresponsive to the report on Friday, rising just 1.2% to $266.7/t, ending the week and month unchanged.

As a result of larger than expected areas before harvest, the forecast of soybean production in 2021/22 was increased compared to the September balance by 0.82 million tons to 121.6 million tons. According to estimates of the US MSG, soybean stocks as of September 1 amounted to 7.5 million tons, which is 13% higher than analysts’ expectations and 7% higher than the figure for September 1, 2021.

November soybean futures on the Chicago Stock Exchange fell 3.5% to $501.5/t on the report on Friday, losing 4.4% for the week and 2.6% for the month.

As a result of the drought-induced decrease in the area before harvesting, the forecast for wheat production in the USA in 2022 was reduced compared to the September balance from 48.5 to 44.9 million tons, which will almost correspond to last year’s 44.8 million tons. Compared to last year, the production of winter wheat wheat will decrease by 14% to 30 million tons, and spring wheat will increase by 46% to 13.1 million tons. Wheat stocks on September 1, according to MSG estimates, amounted to 48.3 million tons, which almost corresponds to the level on September 1, 2021 .

Based on the data of the report, wheat quotes increased:

• by 2.8% or $9.28/t to $338.6/t – December futures for soft winter SRW wheat in Chicago (+4.7% for the week and +12.3% for the month ),
• by 2.6% or $9.09/t to $364.3/t – HRW hard winter wheat December futures in Kansas City (+4.3% for the week and +11.3% for the month ),
• by 1.6% or $5.88/t to $360.8/t – December HRS hard spring wheat futures in Minneapolis (+3.3% for the week and +10.3% for the month).

Tags: corn, prices, soybean, wheat, USA