WASDE: Corn and Soybean Outlook Mostly Unchanged

USDA ( MGN Image )

From USDA:

WHEAT:  The 2019/20 U.S. wheat supply and demand outlook is unchanged this month.  The projected season-average farm price is also unchanged at $4.55 per bushel.  

The 2019/20 global outlook this month for wheat is for higher production, increased consumption and exports, and lower ending stocks.  Output is raised on higher production forecasts for India and Argentina more than offsetting reductions for Turkey and Australia.  India’s production is raised 1.4 million tons to a record 103.6 million, mainly on an updated government production estimate.  World exports are increased by 0.8 million tons to 183.6 million as higher exports by Russia and Argentina more than offset reductions for Canada and Australia.  Russia’s exports are increased 1.0 million tons to 35.0 million, primarily on higher projected imports by Turkey as Russia is its leading supplier.  Turkey’s wheat imports are raised 2.0 million tons to a record-large 10.5 million on higher consumption, reduced production, and government policies to import additional quantities duty-free to stabilize domestic prices.  Turkey’s wheat imports have been rising for the last decade and the country is now projected to be the third-largest importer for 2019/20 behind Egypt and Indonesia.  Wheat imports are also higher for Bangladesh as they increased to a record 6.5 million tons on a robust pace.  Global consumption is raised 0.7 million tons as increases for Turkey, Bangladesh, and Canada more than offset reductions for the EU, Iraq, and Lebanon.  Global ending stocks are projected lower this month but remain record large for the 2019/20 crop year at 287.1 million tons with China comprising 52 percent of the total.  

COARSE GRAINS:  This month’s 2019/20 U.S. corn supply and use outlook is unchanged relative to last month.  The season-average corn price received by producers is lowered 5 cents to $3.80 per bushel based on observed prices to date.

Global coarse grain production for 2019/20 is virtually unchanged from last month at 1,402.8 million tons.  This month’s foreign coarse grain outlook is for slightly higher production, consumption, and stocks relative to last month.  Global corn production is raised 0.4 million tons, as an increase for South Africa is partially offset by reductions for India, Peru, and Russia.  For South Africa, production is higher as continued favorable conditions during the month of February boost yield prospects. 

Major global trade changes for 2019/20 include higher projected corn exports for Ukraine, South Africa, and the EU.  For 2018/19, Brazil’s exports for the marketing year ending February 2020 are lowered based on smaller-than-expected late-season shipments.  Partly offsetting is an increase for Argentina.  Corn imports for 2019/20 are raised for Canada and Peru but lowered for the Philippines.  China’s sorghum imports are raised reflecting recent purchases from the United States.  Foreign corn ending stocks are raised, as increases for South Africa, Canada, and Russia more than offset a decline for Argentina.  Global corn ending stocks, at 297.3 million tons, are up 0.5 million from last month.   

RICE: The 2019/20 U.S. rice supply and use estimates are unchanged relative to last month.  The projected all rice season-average farm price is unchanged at $13.00 per cwt; however, the Other States medium-grain price is lowered $0.20 per cwt to $11.90.  

Global 2019/20 rice supplies are raised 3.4 million tons primarily on a 3.0-million-ton increase for India production stemming from revised government data.  Global exports are lowered 0.5 million tons primarily on a reduced forecast for India, despite its larger supplies.  India’s exports are lowered 0.7 million tons on a slowing pace of trade to African markets.  Global imports are reduced 0.6 million tons led by a 0.3-million-ton reduction for Nigeria which was lowered on a slowing pace of parboiled exports to West Africa and enforcement of land border closures.  India is an important parboiled rice exporter to the region.  World consumption is lowered 0.8 million tons, led by a 0.5-million-ton reduction for India.  With supplies higher and use revised down this month, global ending stocks are raised 4.2 million tons.  Outside of several small and mostly offsetting changes, India accounts for nearly all of the global stock increase.  India and world stocks are now projected at 35.0 million tons and 182.3 million tons respectively.  

OILSEEDS:  U.S. soybean supply and use projections for 2019/20 are mostly unchanged this month.  With soybean crush and exports projected at 2.1 billion bushels and 1.8 billion bushels, respectively, ending stocks remain at 425 million bushels, down 484 million from last year’s record.  Soybean and soybean oil prices are reduced this month.  The U.S. season-average soybean price is projected at $8.70 per bushel, down 5 cents.  The soybean oil price is projected at 31.5 cents per pound, down 2 cents.  Soybean meal prices are unchanged at $305.00 per ton.

This month’s 2019/20 global oilseed outlook includes higher production and stocks relative to last month.  Global soybean production is raised 2.4 million tons to 341.8 million, mainly on a 1-million-ton increase for both Argentina (to 54 million) and Brazil (to 126 million).  Argentina’s larger crop is due to overall favorable conditions in higher-yielding central and northwestern farming areas.  Soybean crush is lowered 1 million tons for Argentina on the current pace to date.  With higher South American production and lower use, global soybean stocks are increased 3.6 million tons to 102.4 million.  Another notable oilseed change includes a 1-million-ton reduction for palm oil production, mainly in Malaysia and Colombia, leading to a 19 percent year-over-year decline in global vegetable oil stocks.

SUGAR:  Mexico sugar production for 2019/20 is projected at 5.200 million metric tons (MT), a reduction of 471,686 from last month.  Analysis based on production through the end of February supports the following projections: area, 780,000 hectares; sugarcane yield, 63.66 MT/hectare; and sucrose recovery, 10.466 percent.  Domestic deliveries and ending stocks equaling 2.5 months of forecast domestic sugar use before the start of the 2020/21 sugarcane harvest, are unchanged.  Exports outside of those shipments under license to the United States are at 33,552 MT, an amount estimated by CONADESUCA that is equal to exports through February 23.  Exports to the United States are reduced by 472,287 MT to 996,834.  

Projected total U.S. supply for 2019/20 is reduced by 668,664 short tons, raw value (STRV) on lower production and imports.  Beet sugar production is forecast lower by 126,820 STRV at 4.317 million.  The reduction is based on processors’ surveys of crop-year production from sugarbeet slicing in the Sweetener Market Data (SMD).  Imports from Mexico are reduced by 551,844 STRV to 1.164 million based on lower sugar supply availability in Mexico.  This reduction is partially offset by a 50,000-STRV increase in high-tier tariff imports, raising the total to 150,000.  This increase is based on import pace and on favorable margins between U.S. and world refined sugar prices.  There are no changes to use.  Ending stocks are projected at 887,559 STRV, implying an ending stocks-to-use ratio of 7.24 percent.

LIVESTOCK, POULTRY, AND DAIRY:  The 2020 forecast of total red meat and poultry production is raised from last month.  Beef production is raised from the previous month as higher expected steer and heifer slaughter more than offsets lower non-fed cattle slaughter.  Heavier carcass weights are also expected to support increased beef production.  Pork production is increased on higher first-quarter slaughter.  The broiler production forecast is raised on the current pace of slaughter as well as recent hatchery data which points towards continued flock expansion.  The turkey production forecast is increased on recent production data and hatchery data.  Forecast egg production is increased as the laying flock continues to expand.  

The 2020 beef import forecast is raised from last month on higher expected imports of processing grade beef, while the export forecast is reduced on weaker anticipated demand in several markets.  Pork exports are raised from last month on recent trade data and strong international demand for U.S. pork products.  The broiler and egg export forecasts are raised slightly from last month on recent trade data, while the turkey forecast is reduced. 

The fed cattle price forecast is reduced from last month on recent price weakness and increased production.  The hog price forecast is reduced on pressure from large hog supplies.  Broiler prices are lowered as larger supplies outweigh demand.  The first-quarter turkey price is reduced on recent price weakness.  Egg prices are raised on expected demand strength. 

The milk production forecast for 2020 is raised from last month on a higher expected cow inventory.  The 2020 fat basis import forecast is raised from the previous month on recent trade data and stronger anticipated imports of cheese and butterfat products.  The fat basis export forecast is reduced on slower expected demand in the first half of the year.  On a skim-solids basis, the import forecast is raised on stronger imports of cheese, milk proteins, and several other dairy products.  The skim-solids basis export forecast is raised on expectations of continued strength in international demand.   

Annual product price forecasts for cheese, butter, and nonfat dry milk (NDM) are lowered from the previous month.  However, the whey price forecast is raised.  The Class III price is reduced on the lower cheese price forecast, while the Class IV price is reduced on lower butter and NDM price forecasts.  The all milk price forecast is lowered from the previous month to $18.25 per cwt.

COTTON:  This month’s 2019/20 U.S. cotton forecasts show lower production, price, and ending stocks relative to last month.  Production is reduced 300,000 bales to 19.8 million, based on the March 10 Cotton Ginnings report.  The final estimates for this season’s U.S. area, yield, and production will be published in the May 2020 Crop Production report.  Domestic mill use and exports are unchanged from last month, and ending stocks are lowered 300,000 bales to 5.1 million.  The projected marketing year average price received by upland producers of 60.0 cents per pound is down 2 cents from last month.

The global cotton supply and demand estimates show larger production and ending stocks.  Consumption is forecast 850,000 bales lower, as a 1-million-bale cut in China’s expected consumption is only partially offset by increases for Bangladesh and Turkey.  Production is up about 250,000 bales as larger expected crops in Brazil, Chad, and Tajikistan offset a lower U.S. crop and some smaller declines elsewhere.  Ending stocks for 2019/20 are projected 1.3 million bales higher this month and 3.2 million bales higher than in 2018/19.