The May WASDE report sets the tone for the new marketing year crop expectations, according to American Farm Bureau Federation Economist Michael Nepveux, who says the report offers the first look at supply and demand expectations.
“This is the highlight of the spring USDA reports as it incorporates the farmer planting decisions from the March Prospective Plantings report and adapts supply estimates to reflect weekly Planting Progress reports. The big story leading up to this report we’ve seen is the rising prices due to increased global demand for U.S. commodities.”
Nepveux says USDA projects corn production at 14.9 billion bushels, up 800 million bushels from the old crop.
“This is just second behind the 2016 production when U.S. corn farmers produced just over 15.1 billion bushels. For soybeans, USDA is projecting new crop at 4.4 billion bushels, and it’s projecting total supplies to decline about 130 million bushels from the current marketing year. There are still quite a few folks out there who think that we are going to see higher acres in the June acreage report that’s released next month as we’ve seen prices have continue higher following when farmers responded to those March surveys.”
This month, USDA estimates 2020/21 corn exports to be a record 2.7 billion bushels and expects tight supplies.
“For new crop corn, USDA projects ending stocks will rise about 250 million bushels to 1.5 billion. That’s quite a bit more than most traders were anticipating and that’s helped to drive some of this pullback in markets that we’ve been seeing. For new crop beans, USDA projects soybean ending stock will rise to 140 million bushels. The old crop bean stocks to use ratio came in at 2.6 percent and the new crop is projected at 3.2 percent.”
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