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The USDA is sending a mixed picture in their July outlook as they left their corn yield unchanged from last month at 166.0 bpa, but increased acres planted 1.9 million to 91.4 million. Ending stocks for 2019-20 are forecast to rise 333 MB to 2.010 BB while world stocks are projected to be up 8.4 million. The USDA is obviously telling us that they are going to wait until the August 12th report to address question of the unplanted acres. According to Ag Watch’s yield model, we are looking at a national yield of 161.4 bpa. With the first frost dates in the upper Midwest between September 15th-October 1st, and the crop in this region at least 2 weeks behind in development, it may struggle to cross the finish line. This should continue to underpin values.
USDA lowered their yield estimate for soybeans 1.0 bpa to 48.5 bpa and reduced planted acres 4.6 million to 80.0. This is somewhat of a surprise since they left corn acres unchanged from June. This resulted in ending stocks for 2019-20 falling 250 MB to 795 MB. World stocks declined 8.2 million tons to 104.5 million. Overall, the report gives the bulls some encouragement, but global stocks remain elevated. Ag Watch’s yield model puts the national yield at 47.1 bpa. Like corn, the soybean crop in the upper Midwest could get clipped further with an early frost.
The USDA gave the bulls in wheat some fodder in the July report in that they lowered 2019-20 ending stocks 72 MB to 1.0 BB. In addition, exports got some good news as they were raised 50 MB while shipments from Australia, Russia, and Ukraine fell. Hopefully, this is an indication that the drought in U.S. exports is coming to an end. Looking at global stocks, they dropped 7.8 million tons to 286.5 million. In other developments, harvest is slowly progressing at 47 percent done compared to the average of 61 percent.
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