SOYBEANS:
US soybean stocks on June 1st came in at 796 million bushels versus an average trade expectation of 805 billion and a range of expectations from 706 to 920 a Last year, June 1st stocks were 968 million. Planted acreage came in at 83.5 million acres versus 87.7 million expected (range 87-89 million). This is slightly higher than the March intentions estimate of 87.5 million.

PRICE OUTLOOK: The USDA report was very bullish, with soybean prices rallying 60 cents after its release. Soybean stocks on June 1st came in within the range of expectations but they were below average expectation. The major surprise was a much lower than anticipated soybean planted acreage figure, which was 2.2 million acres below the average expectation and near the lower end of the expected range. It should be noted this is still a slight increase from the March forecast. The small acreage number combined with significant initial stress in the crop has rekindled fear of a tightening in the US balance sheet, and it has prompted a combination of short covering, stop-loss buying, and fresh speculative interest. Close in support for July Soybeans is at 1520. The move above 1560 today, a fresh contract high immediately after a 3-day correction of $0.90, is likely to push the extreme volatility into the month of July.

CORN:
US corn stocks on June 1st came in at 4.106 billion bushels versus an average trade expectation of 4.250 billion and a range of expectations from 3.791 to 4.410 billion. Last year, June 1st stocks were 4.349 billion. Planted acreage came in at 94.1 million acres versus 91.9 million expected (range 91-93 million). This is up from 92.0 million in the March intentions report.

PRICE OUTLOOK: Corn fell to its lowest level since May 23 in the wake of a very bearish US acreage figure. Having an extra 2.1 million acres of planted corn this year discounts a large measure of the fear of lost production due to the drought. Furthermore, seeing US corn stocks post minimally bullish results offers little offset to the expanded area of the current crop. The real killer for the bull camp is the expectation for 2023 corn harvested acres of 86.3 million, which is a 9% jump from last year.

WHEAT:
The USDA grain stocks report showed US wheat stocks on June 1 at 580 million bushels versus an average trade expectation of 613 million and a range of expectations from 706 to 920. Last year, June 1st stocks were 698 million. All wheat planted acreage came in at 49.6 million acres versus 49.7 million expected (range 48.6-50.2 million) and 49.9 million in the March intentions report. Spring wheat acreage came in at 11.1 million acres versus 10.5 million expected (range 10.1-10.8 million) and 10.6 million in March.

PRICE OUTLOOK: The wheat market came away from the report with a bearish reaction, partly the result of all US wheat planted areas increasing by 9% from last year and from a winter wheat planted area gain of 11% from last year. The fact that winter wheat planted acreage was down 1% from the previous estimate is lost in the shuffle. Furthermore, spring wheat acreage had a 3% year-over-year gain, with hard red spring wheat at 10.5 million acres. Durham planted area this year is expected to be down 9% from last year.

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.

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.