The 2013 crop year for soybeans officially ended Sept. 1, but USDA provided a dramatic postscript to the season, slashing its estimate of carryout to produce record-tight supplies.
In the USDA grain stocks report released Tuesday morning, the government cut its estimate of 2013 ending stocks to just 92 million bushels, the lowest raw total since 1971 and enough to take the ratio of stocks to use to just 2.6%, easily the lowest ever. While Farm Futures expected the government to raise its estimate of 2013 production enough to keep carryout steady at 130 million bushels, USDA instead said the crop was only 69 million bushels more than its last estimate. It increased its yield to 44 bpa, and added 384,000 harvested acres.
November futures cut morning losses after the news broke, then retreated quickly to make new session lows before finally ending into positive territory. The decline in beginning stocks for the 2014 crop year may not matter a whole lot if the new crop is as big as most expect.
Corn and wheat made new session lows after their numbers came out. USDA made only a token cut of 2 million bushels to its estimate for 2014 wheat production, with increases in hard red winter and spring wheat offsetting cuts to the size of the soft red, white winter and durum crops. Sept. 1 stocks were put at 1.914 billion bushels, suggesting feed usage in the summer quarter was less than anticipated by most in the trade.
USDA raised its forecast of ending stocks for the 2013 corn crop by 55 million bushels, likely meaning less corn was feed too as improved pasture conditions provided an alternative. Sept. 1 corn stocks were put at 1.236 billion bushels, adding to an already burdensome supply of corn expected in the year ahead.