by Steve Freed
Soybean ended higher on short covering after USDA did not raise US soybean carryout, raise US 2021 soybean crop less than feared and dropped World soybean end stocks more than expected. USDA 5 mmt drop in Brazil crop was a record with some feeling crop could even be smaller. USDA dropped the Argentina crop 3 mmt. Some could see crop even lower. Next week most of Argentina and South Brazil could see needed rains. Paraguay might miss the rains. USDA raised US 2021 soybean crop 10 mil bu. They left US soybean crush at 2,190 vs 2,141 last year. Exports were also left at 2,050 vs 2,265 last year. Weekly US soybean exports are est near 400-1,200 mt vs 382 last week. USDA Dropped World soybean crush 2 mmt and exports 1.6. Most of the export drop was in Argentina and Paraguay.
Corn futures ended lower with March back below 6.00. USDA raised US 2021 corn crop and ethanol demand but lowered exports. US Dec 1 stocks were above the average trade guess and last year. USDA raised US 2021 acres but kept US yield unchanged. Moat were looking for a higher US 2021 corn crop. USDA raised US ethanol corn use 75 mil bu. Some could see an even higher ethanol demand use number. Weekly US ethanol production was down from last week but still above last year. Stocks were above last week but below last year. Margins continue to slip lower. Some feel Holiday and increase staff reduction due to covid spread may have reduced production. USDA lowered US exports. Some feel a lower SA crop could increase US summer corn export demand. USDA dropped World corn end stocks 2.5 mmt. USDA dropped Brazil and Argentina stocks but raised US. Weekly US corn export sales are estimated near 500-1,500 mt vs 256 last week. It will be interesting to see if Managed funds can hold to longs given slightly higher US carryout and talk of increase rains early next week across some of the dry areas of South America
Wheat futures continued to slide lower post USDA report. USDA raised US 2021/22 wheat carryout due to lower exports and feed use. This was expected. USDA also raised World wheat end stocks. Both were negative to the market. USDA also raised US 2022 winter wheat acres. US SRW 2022 winter wheat acres were higher than expected. USDA raised Argentina wheat crop but lowered Russia wheat exports. USDA increase in winter wheat acres were in NC, OH, KY, MO. Small increase were noted in IL, WI and NE. Declines were noted in GA, AR, and MI. Some feel that KC futures are now below value and given uncertain US south plains weather end users should increase 2022 coverage.
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