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According to the USDA, American farmers will plant less corn and soybeans than expected trade.
As a result, the CME Group corn market has reached its daily upward limit (25 ¢) in trading prices.
As of mid-session, May corn futures are 25 ¢ higher at $ 5.64 1/2. July corn futures are 25 ¢ higher at $ 5.47. December new crop corn futures are 23 3/4 ¢ higher at $ 4.76 1/2.
May soybean futures are 64 ¢ higher at $ 14.31 1/2. July soybean futures are 62 1/4 ¢ higher at $ 14.20 1/2. New crop soybean futures in November are 65 ¢ higher at $ 12.51 3/4.
May wheat futures are 15 ¢ higher at $ 6.16.
Soybean meal futures in May are $ 16.60 short term higher at $ 414.80.
Soybean oil futures in May are 2.40 ¢ higher at 52.86 ¢ a pound.
In foreign markets, the NYMEX crude oil market is up + 0.23 (+ 0.38%) to $ 60.78. The US dollar is lower and the Dow Jones Industrials is 25 points higher (+ 0.08%) at 33,092 points.
Anything over 180.3 million acres breaks the 2017 total acreage record.
In its March Plantations Report on Wednesday, the USDA put the US corn area in 2021 at 91.1 million, compared to trade expectations of 93.2 million and the previous estimate of the USDA Outlook Forum in February of 92.0 million.
For soybeans, the USDA projects an area of 87.6 million acres in 2021 compared to the trade expectation of 89.9 million and the USDA Forum Outlook estimate of 90.0 million.
The total wheat area is set at 46.6 million against trade expectations of 44.97 million and the USDA Outlook Forum estimate of 45.0 million.
March 1 Cereal stocks
The USDA estimates both on-farm and off-farm grain inventory volume as of March 1.
In its report, the USDA put U.S. corn stocks for March 1, 2021, at 7.7 billion bushels compared to the trade estimate of 7.76 billion bushels.
For soybeans, March 1 stocks totaled 1.56 billion bushels, compared with 1.54 billion bushels for trade.
The USDA sees US wheat stocks, as of March 1, at 1.31 billion bushels against the trade estimate of 1.27 billion bushels.
Commercial response
Jack Scoville, PRICE Futures Group, says USDA released a wild report and the uptrend is back.
“The inventory report was mostly as trade forecast, a little less for corn and a little bigger for wheat with soybean estimates. Not much there. But the plantation report Prospects were wild, well below trade estimates for corn, beans, and wheat, ”says Scoville.
“I don’t know why the American farmer doesn’t go from fence to fence, but he wasn’t foresight when he was investigated. In addition, there was a lot of preventative planting area last year which was due to be planted this year. So, I’m not sure I believe the numbers, but they are what we have and we have to roll with them. Limit yourself now and probably locked up for today. We could be higher tomorrow. Maybe we’ll lower a bit tomorrow, only to go higher later. The uptrend is back, ”says Scoville.
Jason Roose, US Commodities, says today’s USDA report tells the story of tight stocks.
“Grains add a price premium with a flurry, after all of the major USDA reports on acres and stocks today. Acres led the way with fewer acres than expected for corn and soybeans. It is estimated that larger areas are needed with stocks at their lowest for several years, with a tight margin of error in the spring, ”says Roose.
Roose added, “Spring weather will be closely watched and acres will be added with higher prices, and exports will remain competitive with a stronger dollar,” Roose said.
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