USDA report bearish for soybeans

WASHINGTON — The US Department of Agriculture in its June World Agricultural Supply and Demand Estimates report lowered its forecasts for both 2020-21 and 2021-22 corn ending stocks while it raised its forecasts for soybean ending stocks for both years. The new forecasts were supportive to corn futures but bearish for soybean futures.   

The USDA projected the carryover of corn on Sept. 1, 2022, at 1,357 million bus, down 150 million bus from the May outlook but up 250 million bus, or 23%, from 1,107 million bus as the revised forecast for 2021. The average of pre-report trade estimates for the 2022 carryover was 1,423 million bus.

The only adjustment from May to the 2021-2022 corn supply forecasts was the 150-million-bu reduction to the 2021-22 carry-in supply, based on the lower forecast for 2020-21 ending stocks.

The USDA forecast 2021 corn production at 14,990 million bus, unchanged from May and up 6% from 14,182 million bus in 2020. The forecast was based on a projected harvested area of 83.5 million acres and forecast trendline yield at 179.5 bus per acre. With corn imports for 2021-22 forecast at 25 million bus, the USDA projected the total 2021-22 corn supply at 16,122 million bus, down 150 million bus from the May projection because of the smaller carry-in supply and down 2 million bus from 2020-21. All demand-side forecasts for 2021-22 were unchanged from May with feed and residual use at 5,700 million bus; food, seed and industrial use at 6,615 million bus, including 5,200 million bus for ethanol, and exports at 2,450 million bus.

The 150-million-bu reduction in forecast 2020-21 corn ending stocks from May was due to a 75-million-bu hike in forecast use for ethanol to 5,050 million bus and a 75-million-bu increase in forecast exports to a record 2,850 million bus.

The USDA forecast the carryover of soybeans on Sept. 1, 2022, at 155 million bus, up 15 million bus from the May outlook and up 20 million bus from an upwardly raised forecast for the 2021 carryover at 135 million bus. The average of pre-report trade estimates for the 2022 soybean carryover was 146 million bus.

The USDA forecast soybean production in 2021 at 4,405 million bus, unchanged from May and up 270 million bus, or 7%, from 4,135 million bus in 2020. The forecast was based on a projected harvested area of 86.7 million acres and a trendline yield at 50.8 bus per acre. With soybean imports forecast unchanged from May at 35 million bus, the USDA projected the total soybean supply in 2021-22 at 4,575 million bus because of the higher carry-in forecast. All demand forecasts for 2021-22 were unchanged from May with crushings at 2,225 million bus, exports at 2,075 million bus, seed use at 104 million bus, and residual use at 15 million bus.

The 15-million-bu hike in the USDA’s forecast for the 2021 soybean carryover to 135 million bus was due to a decrease in forecast 2020-21 soybean crushings to 2,175 million bus.