USDA Report Worksheet and La Niña Is Over - Friday, 10 February 2017

The USDA announced the February Supply and Demand Report on Thursday, February 9, 2017.

Corn:

  • Ethanol usage was increased by +25 million bushels.
  • Ending stocks lowered an additional -35 million bushels from a month ago.
  • Corn used for food, seed and for industrial purposes is raised +10 million bushels.
  • Production out of Argentina and Brazil is unchanged.
  • Export estimates to Ukraine and Canada were increased.

Soybeans:

  • Exports are up 114 million bushels from a year ago.
  • Ending stocks are left unchanged
  • Global oilseed stock projections were lowered.
  • Argentine production was decreased by -2MMT to 55MMT’s
  • Brazil production was left unchanged.

USDA Supply and Demand Thursday, February 9, 2017 Worksheets

2016/17 U.S. Ending Stocks

 

Feb. #

Avg. Trade Guess

Trade Range

USDA January

Corn

2.320

2.335

2.280 - 2.415

2.355

Soybeans

0.420

0.410

0.386 - 0.448

0.420

Wheat

1.139

1.180

1.145 - 1.211

1.186

2016/17 World Ending Stocks

 

Feb. #

Avg. Trade Guess

Trade Range

USDA January

Corn

217.56

220.43

218.00 - 225.10

220.98

Soybeans

80.38

80.93

78.90 - 82.50

82.32

Wheat

248.61

253.13

252.00 - 254.70

253.29

South American Production

 

Feb. #

Avg. Trade Guess

Trade Range

USDA January

Brazil
Corn

86.50

87.05

82.20 - 91.50

86.50

Brazil
Soybeans

104.00

104.08

103.25 - 105.00

104.00

Argentina
Corn

36.50

35.78

34.00 - 36.50

36.50

Argentina
Soybeans

55.00

54.54

52.20 - 56.00

57.00

The Wall Street Journal wrote an article on the downfall of America’s farmers.  The article is titled, “Plowed Under: The Next American Farm Bust Is Upon Us”.  I have quoted a portion of the story, the article begins…"The Farm Belt is hurtling toward a milestone: Soon there will be fewer than two million farms in America for the first time since pioneers moved westward after the Louisiana Purchase. Across the heartland, a multiyear slump in prices for corn, wheat and other farm commodities brought on by a glut of grain world-wide is pushing many farmers further into debt. Some are shutting down, raising concerns that the next few years could bring the biggest wave of farm closures since the 1980s. The U.S. share of the global grain market is less than half what it was in the 1970s. American farmers’ incomes will drop 9% in 2017, the Agriculture Department estimates, extending the steepest slide since the Great Depression into a fourth year."  The U.S. Department of Agriculture reported this week that they expect net farm income will drop to $62.3 billion, this is ½ if the record income of $123 billion earned by farmers in 2013.  Crop receipts are expected to fall .5% this year due to falling prices for key U.S. crops, soybeans and cottons are not expected to see that decline. Soybeans have found strength from exports increasing futures prices by 4.6% so far this year.

The NOAA Climate Prediction Center has released their final La Niña advisory saying that La Niña is officially over.  There is a great deal of uncertainty when forecasting at this time of the year for the upcoming spring and summer but most weather models give us a 60% chance of neutral conditions that will last throughout the Northern Hemisphere spring and a 50% chance it will switch to an El Niño by Sept-November. There are a few dynamic weather models that expect the start of El Niño by the arrival of spring in the Northern Hemisphere.  The first map below shows the cooler than average water temps near the equator that were present in late December proving the existence of La Niña at that time. In the second map you can see the visual change in the water temperature near the equator as of yesterday when compared to the colors in the first map.

 

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