USDA’s August reports have a reputation of potentially being big market movers and that was the case today. This is as the Department released its August World Agricultural Supply and Demand Estimates (WASDE) and Crop Production reports.
“A year ago today, this is when the government [report] came out and we were trading $3 corn,” says Jim McCormick, co-founder of AgMarket.Net. “The one thing I’m going to point out is what we think we know now could change dramatically six months from now.”
McCormick points out the carry-out differences, COVID-19 related news and how exports factor in as well.
USDA says corn yields are expected to average 174.6 bushels per harvested acre, up 2.6 bushels from last year. It’s lower than last month’s trendline number. For soybeans, USDA expects yields to average 50.0 bushels per harvested acre, down .2 bushel from 2020.
Matt Bennett, co-founder of AgMarket.Net says he thought the soybean report was “essentially a non-event” today.
“This is a bullish take from USDA as far as corn is concerned,” says Bennett. “No questions asked.”
The team also discusses USDA’s new-crop corn ending stocks at 1.24 billion bushels and how demand and yield plays a factor with the department’s numbers.
“I’m looking at the spreadsheets. I’m coming up with a 5 million metric ton deficit in the world using today’s numbers from USDA of where they reduced supply and shifted a little bit of demand around,” says Biedermann. “It’s just impossible to have these exports drop that much.”
Watch the video above for more of the conversation.
-Betsy Jibben
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