US: Grain Stocks


January 12, 2021 11:00 CST

USDA December 1 Quarterly Grain Stocks Pre-Report Estimates
Estimates
HightowerLowHighLast Year
Corn11,7478,20012,27011,327
Soybeans2,9292,7753,2153,252
Wheat1,6961,5851,8271,841
U.S. Grain Stocks (1000 Bushels)
20192020
On FarmsOff FarmsTotalOn FarmsOff FarmsTotal
Corn
Mar 15,131,0003,482,2068,613,2064,454,0003,497,5767,951,576
Jun 12,949,6002,252,6365,202,2362,867,0002,135,9875,002,987
Sep 1814,1001,406,6492,220,749750,8001,168,6621,919,462
Dec 17,103,0004,224,33811,327,3387,046,0004,275,69611,321,696
All Wheat
Mar 1367,8701,225,2011,593,071338,6901,076,7241,415,414
Jun 1206,545873,2161,079,761228,585799,6991,028,284
Sep 1734,5001,611,0252,345,525705,0501,452,7752,157,825
Dec 1519,4701,321,3051,840,775483,4701,190,1251,673,595
Soybeans
Mar 11,270,0001,457,0692,727,0691,011,5001,243,3822,254,882
Jun 1730,0001,053,0801,783,080633,000748,3941,381,394
Sep 1265,000644,052909,052141,200383,341524,541
Dec 11,519,5001,732,9883,252,4881,308,5001,624,8222,933,322

Highlights
SOYBEANS:
The January USDA Supply & Demand along with Quarterly Grains Stocks were supportive against expectations but the Argentina forecast seems to have sparked aggressive buying. US 2020/21 soybean ending stocks were lowered from the December report to 140 million bushels. This was near the average pre-report estimate of 139 million. Production was lowered to 4.135 billion bushels. This was well below the average pre-report estimate of 4.456 billion and near the low end of expectations from 4.103 and 4.197 billion. Yield was lowered to 50.2 bushels/acre with a range of expectations from 49.9 and 51.0. Brazil's 2020/21 soybean production was left unchanged at 133 million metric tonnes. This was above the average pre-report estimate of 131.1 million. Argentina's 2020/21 soybean production was lowered 48 million metric tonnes. This was below the average pre-report estimate of 48.4 million. World ending stocks were lowered to 84.31 million tonnes from 85.6 million previously. This was above the estimate of 82.8 million. US Soybean stocks as of December 1st were 2.933 billion bushels. This is was close to the average estimate. Last year stocks were 3.252 billion bushels.

PRICE OUTLOOK: Taking out the $13.96 3/4 resistance leaves $15.30 as next upside target for nearby futures. March meal support comes in at 447.40, with 478.00 as next target.

CORN:
The January USDA Supply & Demand along with Quarterly Grains Stocks were slightly supportive against expectations but the forecast for dry weather next week in Argentina has sparked aggressive buying. US 2020/21 corn ending stocks were lowered from the December report to 1.552 billion bushels. This was below the average pre-report estimate of 1.592 billion. The range of expectations from 1.400 and 1.782 billion. Production came in at 14.182 billion bushels and below the average pre-report estimate of 14.446 billion. (14.319 and 14.537 range. Yield was lowered to just 172 bushels/acre. This was below the average pre-report estimate of 175.1 bu/acre and below the range of expectations from 173.8 and 176.2. Brazil's 2020/21 corn production was lowered to 109 million metric tonnes. This was above the average pre-report estimate of 107.5 million. Argentina's 2020/21 corn production was lowered to 47.5 million metric tonnes. World ending stocks were lowered to 283.83 million tonnes from 289.0 million previously. This was near the estimate of 283.7 million tonnes. US Corn stocks as of December 1st were 11.322 billion bushels. This is was within the range of estimates but below the average. Last year stocks were 11.327 million bushels.

PRICE OUTLOOK: There seems to be plenty of factors which could tighten stocks further including stronger US demand trends and the potential for a sharp drop in South America production. The next upside target comes in at 566 with support at 503.

WHEAT:
The January USDA Supply & Demand along with Quarterly Grains Stocks and Winter Wheat Seeding reports were supportive against expectations. US 2020/21 wheat ending stocks were lowered from the December report to 836 million bushels. The was below expectations for 859 million bushels (837-900 million range) and down from 862 million in the December report. World ending stocks were lowered to 313.19 million tonnes from 316.5 million previously. This was below the estimate of 315.4 million tonnes but in the range 310.0 to 318.4. Winter Wheat seedings for 2021 were 31.99 million acres which was above the average pre-report estimate of 31.45 million. The range of expectations from 29.9 and 32.5 million acres. US Wheat stocks as of December 1st were 1.674 billion bushels. This is was within the range of estimates but below the average. Last year stocks were 1.841 billion bushels.

PRICE OUTLOOK: The USDA data was supportive against expectations and outside market forces plus a surge higher in the other grain markets has helped support aggressive buying. March wheat support is at 651, with 678 as next upside target. March KC wheat support is at 605 1/4, with 627 1/2 and 641 as next upside targets.

Definition
This full-text report, issued four times yearly, contains stocks of all wheat, durum wheat, corn, sorghum, oats, barley, soybeans, flaxseed, canola, rapeseed, rye, sunflower, safflower, mustard seed, by States and U.S. and by position (on-farm or off-farm storage); includes number and capacity of off-farm storage facilities and capacity of on-farm storage facilities. The data is obtained via an off and on-farm stocks survey, the on-farm survey is a probability survey of farm operators, the off-farm stocks survey is enumerates the volume of grain in all known commercial grain storage facilities.

Description
Unlike the WASDE and other USDA reports, this report measures actual (counted) supply, not estimates or forecasts. It helps verify or correct the estimates in other the USDA reports, such as WASDE.

September is the most closely watched of the four quarterly reports, as it measures stock levels at the end of the marketing year for corn and soybeans. This number should equal the ending stocks number in the monthly Supply/Demand (WASDE) reports. If the September Grain Stocks number is different from the recent WASDE report, the next WASDE report will show an adjustment in supply and demand data to bring the numbers in line with each other. For example, if the WASDE reports have been calling for corn ending stocks to come in at 2.000 billion bushels and the September Grain Stocks report shows September 1 corn stocks at 1.892 billion, it would mean that actual supplies are smaller than projected. This would be a bullish surprise for the market, and we would expect the upcoming October WASDE report to reflect the new estimate.

The January, March and June stocks can also inform the rate of demand as the marketing year progresses.

The marketing year for wheat ends on May 31, and as such, the June Grain Stocks report is the most important for the wheat market.