USDA bumps U.S. wheat, soybean carryover


The U.S. Department of Agriculture in its Dec. 12 World Agricultural Supply and Demand Estimates report raised its forecast for 2018 U.S. wheat carryover by 3% from its November forecast due to a reduction in export estimates, raised its forecast for soybean carryover due to reduced exports and lowered its corn carryover based on increased use of corn for ethanol.

The USDA forecast the carryover of all wheat on June 1, 2018, at 960 million bushels, up 25 million bushels from its November forecast at 935 million bushels. That change comes from a 25-million-bushel reduction in projected exports. All other 2017-18 wheat forecasts were unchanged, as were 2016-17 estimates with 2017 carryover at 1,181 million bushels.

“This reduction is primarily attributed to heightened Canadian competition expected from its increased exportable supplies,” the USDA said. “Canada and the United States compete in several of the same markets in Latin America and East Asia.”
Slight changes were made in wheat-by-class carryover forecasts for 2018 with hard red winter at 470 million bushels, up 9 million from November on a 10-million-bushel forecast decrease in 2017-18 exports at 405 million bushels and a 1-million-bushel decline in total supply. Hard red spring carryover on June 1, 2018, was forecast at 167 million bushels, up 10 million bushels from November based on a like decrease in exports, forecast at 255 million bushels. Soft red winter carryover was forecast at 230 million bushels, up 8 million bushels on a 5-million-bushel decrease in exports and a 3-million-bushel increase in total supply. White wheat carryover was forecast at 65 million bushels, down 2 million bushels due to a like decrease in total supply. Durum carryover was unchanged at 28 million bushels.

Soybean carryover on Sept. 1, 2018, was forecast at 445 million bushels, up 20 million bushels from November based on a 5-million-bushel increase in seed use more than offset by a 25-million-bushel reduction in exports at 2,225 million bushels. All other 2017-18 forecasts and 2016-17 estimates were unchanged with 2017 carryover at 301 million bushels.

Corn carryover on Sept. 1, 2018, was forecast at 2,437 million bushels, down 50 million bushels, or 2%, from November but up 6% from 2,295 million bushels in 2017. The decrease resulted from a 50-million-bushel increase in use of corn for ethanol.

“Corn used to produce ethanol is raised 50 million bushels, based on increased sorghum export commitments, and the most recent data from the Grain Crushings and Co-products Production report, which estimated a lower-than-expected amount of sorghum used to produce ethanol during October,” the USDA said.

Wheat, corn and the soybean complex futures closed lower for the day.


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