February WASDE: Dwindling soybean supply, discrepancy in corn

by | Feb 9, 2021 | 5 Ag Stories, News

Market analysts feel “confused” and “disappointed,” after the U.S. Department of Agriculture (USDA) earlier today released its February World Agricultural Supply and Demand Estimates (WASDE) report.

Jim McCormick, branch manager of AgMarket.Net, says USDA’s February report was “slightly friendly, but not as bullish as the trade was looking for.”

“Plain and simple, the trade was looking for the corn carryout to drop to 1.392 billion,” McCormick says. “They raised exports by 50 million, which means the projected carryout is going to be 1.502 billion, hence the pressure on the corn market.”

Greg McBride, commodities broker with Allendale, felt confused by corn revisions. However, McBride recognizes, “At the end of the day, these are the numbers we have to work with.”

“It is a little bit confusing,” McBride says. “The USDA made a change with an increase of 6.5 million metric tons of export, or 256 million bushels to China last month. But they only changed the overall export demand by 50 million bushels. There’s a 200 million bushel discrepancy there.”

USDA officials lowered soybean ending stocks to 120 million bushels. McCormick say we are now scraping “the bottom of the barrel.”

“It’s going to be hard to your hands on beans,” McCormick says. “The revision down was on exports, which we believe is strong. They left the crush number unchanged. But, we’re crushing the living heck out of beans now. What the government is thinking, we get to the latter half of summer, it’s going to be hard to get your hands on beans and that’s going to end up slowing that crush down a little bit. Stocks are going to be the tightest we have seen.”