USDA: U.S. corn being priced out of export markets

Today USDA released the latest World Agricultural Supply and Demand Estimates (WASDE) report.

2022-2023 U.S. ENDING STOCKS

For corn, USDA pegged the U.S. 2022-2023 ending stocks at 1.257 billion bushels. This is above both the trade’s estimate of 1.241 billion bushels and USDA's November estimate of 1.182 billion bushels.

For soybeans, the U.S. ending stocks were 220 million bushels, below the trade’s expectation of 236 million bushels and reflecting no change from USDA’s November estimate of 220 million bushels.

USDA pegged the U.S. wheat ending stocks at 571 million bushels, in line with November’s estimate of 571 million bushels but below the trade’s expectation of 578 million.

2022-2023 WORLD ENDING STOCKS

USDA pegged the world’s corn ending stocks at 298.4 million metric tons (mmt.) vs. the trade’s expectation of 300.9 mmt. Last month USDA’s estimate was 300.8 mmt.

For soybeans, the world ending stocks are estimated at 102.7 mmt., slightly above the trade’s expectation and USDA's November estimate of 102.2 mmt.

For wheat, the USDA pegged world ending stocks at 267.3 mmt. This is slightly above the trade’s expectation of 267 mmt. and below the November estimate of 267.8 mmt.

2021-2022 WORLD ENDING STOCKS

USDA pegged the world’s corn ending stocks at 307.1 mmt. vs. the trade’s expectation of 307.7 mmt. and USDA’s November estimate of 307.7 mmt.

For soybeans, the world ending stocks are estimated at 95.6 mmt. vs. the trade’s expectation of 94.7 mmt., and USDA's estimate last month of 94.7 mmt.

For wheat, USDA pegged world ending stocks at 276.3 mmt., right in line with the trade’s expectation of 276.3 mmt. and the November estimate of 276.3 mmt.

2022-2023 ARGENTINA AND BRAZIL CROP PRODUCTION

For corn, Argentina’s production is pegged at 55 mmt. Brazil’s corn production is estimated at 126 mmt. 

For soybeans, Argentina is estimated to produce 49.5 mmt. Brazil’s soybean production is pegged at 152 mmt.

MORE FROM USDA

“This month’s 2022/23 U.S. corn outlook is for lower exports and greater ending stocks,” USDA says in the report. “Exports are lowered 75 million bushels as competition from other exporters and relatively high U.S. prices have resulted in slow sales and shipments through early December.

“Soybean supply and use projections for 2022/23 are unchanged from last month. Based on a review of EPA's recent proposed rule for renewable fuel obligation targets, soybean oil used for biofuel for 2022/23 is reduced 200 million pounds to 11.6 billion. Soybean oil exports are also reduced on historically low export sales through November. With reduced use of soybean oil for biofuel and exports, food use and ending stocks are raised.”

TRADE REACTION

Al Kluis, managing director of Kluis Commodity Advisors, calls today’s report a “non event.”

“[Focus is] back to trading South American weather and seeing how high the meal market can go,” he says. “The USDA finally made a reduction in corn exports, maybe lower again in future reports. The focus is on Argentina.”