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Bullish USDA WASDE Report

Wow what a surprise the USDA gave us on January 12th regarding the corn balance sheet. The biggest take away is the trades lack of knowledge of harvested acres. The trade was estimating 80.8 million acres to be harvested while the report guided that only 79.2 million acres were. My assumption is that the government underestimated how much of the drought area’s crop was chopped for silage. To give some context, this is the largest reduction from January in 34 years!


Balance Sheets came in bullish for corn and soybeans with the USDA offering a 1.242 Bbu. number for corn and beans at 220 Mbu. Both tightened the U.S. balance sheet and offered bullish support for the grains sector.

Going forward, we need to keep a watch on the Brazil/Argentina corn crop which estimates were reduced by 3 MMT as well as U.S. exports. This marketing year corn has remained sluggish regarding export sales and movement as the U.S. is 150 Mbu. Lastly, traders and producers need to watch Ukraine shipments going into this new year as there is certainly still some significant risk premium added to the market regarding the conflict in the Black Sea Region.



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