Corn Ending Stocks Diminish Due To Decreased Production

The USDA's estimate for the final 2013/14 corn yield dropped an astoundingly 1.6 bushels per acre, which brought U.S. ending stocks and total production down as well. Corn stored in all positions as of December was up 30% year over year. The USDA continues to set the floor for domestic soybean ending stocks at 150 million bushels, by increasing U.S. production, but also increasing demand.

Corn
U.S. corn production for 2013/2014 was estimated at 13.9 billion bushels, a 64 million bushel decrease due to a reduction in production estimates. Though harvested acres were increased to 436,000 acres, the estimated average yield was decreased to 158.8 bushels per acre from 160.4 bushels per acre.

Domestic corn use for 2013/2014 was raised by 100 million bushels due to an increase in feed and residual use. Corn used for ethanol production was estimated 50 million bushels higher due to strong weekly ethanol production and higher 2014 gasoline consumption forecasted from the Energy Information Administration. Corn ending stocks for 2013/2014 were 161 million bushels lower to 1.6 billion. Projected season-average price range for corn in 2013/2014 is $4.10 to $4.70 per bushel.

Global corn production is increased 4.3 million tons due to increased production in China. A 6.0 million ton increase in Chinese corn production reflected the latest upward revision by the China National Grain and Oil Information Center, indications from the National Bureau of Statists for total 2013/2014 grain production, and review of growing-season weather.

USDA reported 10.4 billion bushels of corn on hand for December 1, 2013, a 30% increase from a year ago. Of the total stocks, 6.38 billion bushels are stored on farms, up 39% to last year. Off-farm stocks were at 4.05 billion bushels, up 17% from a year earlier. September-November 2013 disappearance was 4.32 billion bushels, compared to 3.74 billion bushels a year ago.

Soybeans

U.S. soybean production for 2013/2014 increased 31 million bushels to 3.289 billion due to increased yield and harvested area. Soybean yield is up 0.3 bushels per acre to 43.3 bushels per acre. Exports for soybeans increased 20 million bushels to 1.495 billion bushels. The increase in exports was due to record shipments during the first quarter and strong sales in December.

Ending stocks for 2013/2014 are unchanged from last month remaining at 150 million bushels. U.S. season-average price forecast for soybeans in 2013/2014 was narrowed 25 cents on both ends of the range to $11.75 to $13.25 per bushel.

Global oilseed production for 2013/2014 increased 3.6 million tons moving the estimate to a record 505.9 million tons. Global soybean production increased 1.9 million tons moving the estimate to 286.8 million tons due to gains from the United States and Brazil.

Soybeans stored in all positions increased 9% compared to last year with 2.15 billion bushels as of December 1, 2013. Stocks stored on farms totaled 955 million bushels, a 5% increase from a year ago. Off-farm stocks increased to 1.19 billion bushels, up 13% from last December. September-November 2013 disappearance totaled 1.28 billion bushels, an increase of 4% from last year.

Wheat

U.S Wheat supplies for 2013/2014 remain unchanged for the month, but projected ending stocks increased 33 million bushels due to lower expected use. Wheat exports are estimated 25 million bushels higher due to lower expected competition from Argentina and strong pace of sales and shipments to Brazil’s milling wheat market. Projected 2013/2014 season-average price was 10 cents lower at the midpoint and narrowed at both ends of the range to $6.60 to $7.00.

Global wheat supplies for 2013/2014 were raised 1.5 million bushels to 888.8 million tons with production increases for China and FSU-12 more than offsetting reduction for Argentina and the European Union.

Wheat stocks decreased 12% from last year with 1.46 billion bushels being reported on December 1, 2013. On-farm stocks were estimated at 399 million bushels, down slightly from last December. Off-farm stocks were down 16% from last year, coming in at 1.06 billion bushels. The September-November 2013 disappearance was 407 million bushels, down 6% from December of last year.

Outlook

As we close the books on 2013, we look to the future of agriculture in 2014. What will South America produce in the coming months? How fast will China's demand for agriculture products rise? When will a Farm Bill get passed? What is the future of the Renewable Fuels Standard? We will be following these events and others as they unfold.