Little Moves Domestically, Big Moves Internationally (2/9/12)
Chad Hart , ISU Extension Grain Marketing Specialist, provides a summary of the latest report from USDA.
With today’s USDA report, the projections for the domestic corn and soybean markets changed very little. But the outlook for global supplies has shifted downward. For soybeans, the U.S. outlook remained the same, lower export and crushing demand. 2011/12 ending stocks are projected at 275 million bushels and the midpoint of the 2011/12 season-average price range held at $11.70 per bushel. For corn, there was a slight uptick in corn imports (5 million bushels) that was more than offset by a slight uptick in corn exports (50 million bushels). The changes leave 2011/12 ending stocks at 801 million bushels, slightly above trade expectations. USDA narrowed their price range by 10 cents on each end, but the midpoint remains at $6.20 per bushel.
The big changes were for the South American crops. The projection for Argentine corn was lowered 15% to 22 million tons. That would put Argentina’s corn production below last year’s level. For soybeans, Argentina, Brazil, and Paraguay are projected to have lower production. The soybean prospects for Argentina were dropped 5%. Brazil’s crop was cut 2.7%. Paraguay had the largest decline at nearly 16%. Overall, the South American soybean crop looks to be roughly 5% smaller than last year. The cuts in the South American crops could send the markets higher based on the improving prospects for U.S. exports.
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