May 20, 2018

March 2018 USDA Prospective Plantings and Grain Stocks Reports

March 29th, 2018

Summary

US Grain Stocks - March 1 (million bushels)
Last Year Avg Estimate USDA Mar 18
Corn 8,622 8,706 8,888
Soybeans 1,739 2,030 2,107
Wheat 1,659 1,498 1,494
Prospective Plantings (million acres)
USDA Feb Avg Estimate USDA Mar 18
Corn 90.0 89.420 88.026
Soybeans 90.0 91.056 88.982
Wheat 46.5 46.297 47.339

 

Two reports were issued by USDA’s National Agricultural Statistics Service today. Grain Stocks is the quarterly count of last fall’s harvest still remaining on March 1. This represents stocks after ½ year of usage. Prospective Plantings is USDA’s survey of producers conducted around March 1. This year’s survey was conducted from February 27 – March 19. It included results from 82,946 farmers across the nation and across numerous crops. Today’s reports do not include the normal monthly supply/demand report numbers. There were no production estimates, demand estimates, or ending stocks. The only thing we received today was old crop stocks still around as of March 1 and USDA’s planted acreage estimate.

Corn:

March 1 Grain Stocks: USDA counted 8.888 billion bushels of old crop still around after two quarters of usage. This was a bit over the 8.706 trade expectation (ALDL 8.743). This report is very important for corn as it fills in the blanks for unknown feed/residual demand for the second quarter. USDA’s new numbers imply feed/residual this past quarter was 1.515 billion bushels. That would be 0.8% under last year. Many US based livestock operators would argue against that seemingly low number. USDA may adjust their old crop ending stock number higher on the April supply/demand report.

2018 Acreage: USDA’s annual survey suggested 88.026 million planted this year. That would be 2.141 under last year and a full 9.265 under the peak in 2012. It was also under the 89.420 trade estimate (ALDL 88.514). Lower corn was not the surprise. The size of the decline was the issue. Acreage in the top three crops (corn, soybeans, all-wheat) was seen 1.974 under last year. Allendale won’t argue with lower acreage in general. Acreage flows with margins. We would suggest USDA’s corn planting estimate is low.

Soybeans:

March 1 Grain Stocks: 2.107 billion bushels of soybeans were counted as of March 1. The trade estimate was 2.030 (ALDL 2.099). As we have solid data on second quarter crush and exports, USDA will have to adjust either the small category called feed/seed/residual or the fall 2017 harvest to make the numbers work.

2018 Acreage: The annual acreage survey from USDA found 88.982 million. This was far under the 91.056 trade estimate, and Allendale’s 92.104. This represents a 1.160 million decline from last year. Technically, a 2 million miss from the trade estimate won’t change the new crop balance sheet from all out bearish to all out bearish. Before the report, Allendale’s big acreage estimate would have implied, conservatively, 644 million bushels. This new number, and a 50% offset of the supply change, would put stocks at 569. In the short term, USDA’s number is now THE number despite protestations from the industry. For the acreage mix, the 11 Midwest states suggested an 830,000 acre decline. Everyone else would be down by 330,000.

Wheat:

March 1 Grain Stocks: 1.494 million bushels of wheat was found as of March 1. That was right next to the 1.498 trade estimate (ALDL 1.488). With one quarter of usage left, USDA may be hard pressed to find the demand they need to justify current stocks.

 2018 Acreage: It was a little surprise to see the 47.339 million acre planting estimate for all wheat. That was over the 46.297 trade estimate (ALDL 46.889). Winter wheat was adjusted from January’s 32.608 from the Winter Wheat Seedings report to now 32.708. Minor adjustments to last fall’s planting are not a surprise. Other spring wheat was counted at 12.637 million. This was far over the 11.500 trade estimate (ALDL 11.924). This number would be 1.628 over last year. Durum was noted at 2.004 million.

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