Corn 377 up 9.75 (+2.65%)
WASDE: Lower Ending Stocks for Corn, Soybeans, Wheat
U.S. 2018/19 wheat supplies are increased slightly this month on higher beginning stocks and production. Winter wheat is forecast up 6 million bushels to 1,198 million with modest increases in all winter wheat classes and total wheat production is now at 1,827 million. U.S. exports are raised 25 million bushels to 950 million on tightening Russian exportable supplies. Projected 2018/19 ending stocks are lowered 9 million bushels to 946 million, down 12 percent from last year. The projected season-average farm price is up $0.10 per bushel with the midpoint at $5.10, compared to the revised 2017/18 price of $4.75.
World 2018/19 wheat supplies decreased this month by 1.2 million tons on production declines in Russia, the EU, and Mexico not completely offset by higher projected production from India and the United States. Russia’s production is lowered by 3.5 million tons to 68.5 million on drier-than-normal conditions this spring in winter wheat areas and excessive wetness in spring wheat regions lowering plantings. Russia’s wheat production is projected down 19 percent from last year’s record 85.0 million tons. EU wheat production is reduced 1.0 million tons to 149.4 million on dry conditions this spring for winter wheat in Germany and Poland. India’s wheat production is raised 2.0 million tons to 97.0 million, based on record yields and supported by reports of higher procurement for the 2018/19 crop compared to last year.
Projected global 2018/19 trade is lower, mainly on reduced Russian exportable supplies with a smaller crop. Russia’s exports are reduced 1.5 million tons to 35.0 million, but Russia still remains the world’s leading wheat exporter. Global imports are lowered, mainly on reduced imports for India as the government recently raised its wheat import tariff. Projected 2018/19 world consumption is 3.0 million tons lower, primarily on reduced feed usage for Russia and the EU. Global ending stocks are raised 1.8 million tons this month to 266.2 million but are still below last year’s record 272.4 million.
COARSE GRAINSHere's the complete report (40 page PDF)
This month’s 2018/19 U.S. corn outlook is for reduced beginning stocks, lower feed and residual use, greater corn used for ethanol production, and lower ending stocks. Beginning stocks are down largely reflecting a 75-million-bushel increase in projected exports for 2017/18 to 2.300 billion bushels, which if realized would be the highest since 2007/08. Exports during the month of April were record high, besting the prior monthly shipment record set in November 1989. Export inspection data for the month of May implies continued robust global demand for U.S. corn, while old crop outstanding sales at this point in the marketing year are record high. Projected 2018/19 corn used for ethanol is raised 50 million bushels, offsetting a 50-million-bushel reduction in food, seed, and industrial (FSI) use of sorghum. Corn feed and residual use is lowered 25 million bushels with increased ethanol by-product production and higher expected prices. With supply falling and use rising, ending stocks are lowered 105 million bushels to 1.577 billion bushels, which if realized, would be the lowest level since 2013/14. The season-average farm price is raised 10 cents at the midpoint with a range of $3.40 to $4.40 per bushel....MUCH MORE
As noted back on April 30:
...We missed a trick by not pointing out one of the classic chart patterns then developing in wheat:
...And what does all this mean?
The May WASDE Report looks to be the most important (and potentially market moving) report of the last few years. If growing degree days begin to catch up to average over the next 10 days, corn collapses as wheat stays relatively stronger.
Wheat up 11'2 (2.26%) at 509'6
Corn up 3'4 (0.88%) at 402'0