CORN:
U.S. 2024/25 corn yield came in at 183.8 bushels/acre, versus the average estimate of 183.5 and September's 183.6. The range of expectations was 181.6 to 184.8. The small increase in yield is not significant although most thought yield would be steady to slightly down. Harvested acres came in at 82.7 million. The average estimate was 82.7 million acres, and the range was 82 to 82.7. The September estimate was 82.7 million. Production is estimated at 15.203 billion bushels versus 15.173 billion expected (range 15-15.283 billion) and 15.186 in the September report. U.S. ending stocks for 2024/25 are estimated at 1.999 billion bushels, compared to 1.988 billion expected (range 1.835-2.167 billion) and 2.057 in September. USDA left the U.S. balance sheet mostly unchanged, except for a 25 million bushel bump up in U.S. exports. World ending stocks for 2024/25 came in at 306.5 million tonnes versus 307.3 million expected (range 305.5-310.2 million) and 308.4 in September. Not surprisingly, Ukraine corn was cut to 26.2 million tonnes, down 1 million from last month and China corn was cut 2 million tonnes to 209.3 million tonnes. Brazil's production for 2024/25 was 127 million tonnes, versus 126.6 million expected (range 123.1-127 million) and 127 in September. Argentina's production for 2024/25 was 51 million tonnes, versus 50.8 million expected (range 49-52 million) and 51 in September. It is too early in the season to expect any change from USDA in this report for South American crops.

PRICE OUTLOOK:
Today's report failed to offer any major surprises, and with U.S. and South American weather leaning bearish, prices may move lower in the short-term, searching for a level that stimulates additional demand. USDA announced a significant sale of 577,948 tonnes of corn sold to Unknown this morning as U.S. prices remain very competitive, and that is expected to continue through the end of the year, offering demand-led support on breaks. 50% retracement support on December corn comes in at 410 and.618% at 404 1/4. Speculators can consider buying on a break below 410 as U.S. harvest is likely to past the 50% mark next week

The World Agricultural Supply and Demand Estimates (WASDE) report is prepared monthly and includes forecasts for U.S. and world wheat, rice, and coarse grains (corn, barley, sorghum, and oats), oilseeds (soybeans, rapeseed, palm), and cotton. U.S. coverage is extended to sugar, meat, poultry, eggs, and milk. USDA World Agricultural Outlook Board analysts chair the Interagency Commodity Estimates Committees (ICECs) comprising representatives from several key USDA agencies. The nine ICECs- one for each commodity- compile and interpret information from USDA and other domestic and foreign official sources to produce the report.

The ICECs rely on Foreign Agricultural Service (FAS) attaché reports and analysis of foreign commodity developments, Economic Research Service (ERS) domestic and foreign regional assessments, and National Agricultural Statistics Service (NASS) U.S. crop and livestock estimates. For domestic policy and market information, the Board relies on the Farm Services Agency and the Agricultural Marketing Service. WAOB and FAS use weather analysis and satellite imagery to monitor crop conditions. Additional private and public information sources are considered.

This broad information base is reviewed and analyzed by ICEC members who bring diverse expertise and perspectives to the report. To arrive at consensus forecasts, alternative assessments of domestic and foreign supply and use are vetted at the ICEC meetings. Throughout the growing season and afterwards, estimates are compared with new information on production and utilization, and historical revisions are made as necessary.

The WASDE reports a full balance sheet for each commodity. Separate estimates are made for components of supply (beginning stocks, imports, and production) and demand (domestic use, exports, and ending stocks). Domestic use is subdivided into major categories, for example corn for feed and corn for ethanol. Domestic use may be based on data from other Federal agencies: for example, U.S. wheat ground for flour, soybeans crushed for oil, and cotton mill use come from the Bureau of the Census. The demand side of the balance sheet may include a category for “residual” or “unaccounted” disappearance to balance known uses against total supplies.

The WASDE also reports forecast season-average farm prices for most items. Prices tie together both sides of the balance sheet. Market prices aid in rationing available supplies among competing uses. Prices also indicate potential supply responses, for example potential planting decisions for the upcoming year. The process of forecasting price and balance sheet items is complex and involves the interaction of expert judgment, commodity models, and in-depth research by USDA analysts on key domestic and international issues.

These reports present US and world supply/demand outlooks for a wide variety of agricultural products, including grains, oilseeds, cotton, pork and beef. They represent an accumulation of data on production and usage and offer projections for current/upcoming the marketing year.

The reports are released monthly, but the estimates are not necessarily revised every month. For the US data, production numbers tend to be revised during the growing season and into harvest, while demand numbers tend to be adjusted once the harvest is in and the products are marketed. The world data is adjusted every month because the data comes from many countries around the world.

Analysts focus primarily on each year’s ending stocks, as that provides a picture of whether supplies will be “tight” or “ample” at the end of the year. However, as production and consumption have been on a long term growth path for several decades, stock levels that may have been considered “ample” in years past may not be so anymore. With that in mind, analysts often prefer to use the stocks/usage ratio as a way of taking into account long term growth trends.

The world data covers individual countries as well as the entire world. Special attention is paid to the key producers, exporters and consumers. Brazil and the US together represent about 70% of global production and 85% of exports. The US, Argentina and Brazil represent 70% of global corn exports. Wheat is grown all around the world, with the US, Argentina, Australia, Canada, EU, Russia and Ukraine all major producers. India is the world’s largest producer of cotton, but the US is by far the largest exporter.

Traders will also want to keep in mind that marketing years vary from crop to crop, coinciding with the harvest. For example, wheat’s marketing year runs from June through May, cotton’s from August through July, corn and soybeans from September through August, and soybean meal and soybean oil from October through September (one month after soybeans).

The WASDE report also covers US meat production and consumption, including beef, pork and poultry. Annual production, consumption, export and stocks data is presented in the report, similar to the field crops. But this report also presents quarterly production data, which is of interest to cattle and hog traders, who track quarterly changes and compare them to previous years to gain insight as to whether the supply setup in upcoming quarters.