MINNEAPOLIS — Now that the dust has settled from several mid-summer U.S. Department of Agriculture crop reports, the trade turns its focus to weather entering the dog days.
The USDA released its monthly supply and demand estimates and crop production reports July 10 on the heels of the quarterly stocks and planted acreage projections in late June.
Ami Heesch, CHS Hedging commodity broker, took a look at the numbers in a Minneapolis Grain Exchange-hosted teleconference.
What is the trade focused on going forward now that this report has been released?
The trade will be looking at what the weather does for the rest of July and yield going forward to maturity, basically seeing what the weather does and how it affects yield.
It has been a practice of the USDA to survey people to get a calculated yield and production number in August, and that will be important going forward in our August report for all of our commodities. The small grains summary comes in September and you’ll see the winter wheat final production numbers.
Are you seeing any indication of what we’ll see for prevent plant acres in August?
I think there will be prevent plant, primarily in North Dakota. We may see 3% to 5% of the spring wheat crop that they intended to plant, but didn’t plant because it just got too late. They were harvesting, planting and fertilizing all at the same time. I think the same is true with corn.
We had 17 to 18 million prevent plant acres last year. I think we’ll be well below that this year, maybe 1 million to 3 million, 1 million to 5 million acres of prevent plant just based on some of the acres of corn. Where we may have 3 million acres of corn typically in North Dakota, we probably would only have 1 million acres.
I think the eastern Corn Belt did fairly well. They had replants, but they got planted early and they could go. Iowa didn’t have much prevent plant this year. Primarily northwest Minnesota and eastern North Dakota areas kind of got stung this year, but I’m thinking prevent plant will be significantly less than last year.
What are some of the key highlights of note on the corn, soybean and wheat sides of the report?
Corn feed usage for 2019-2020 was down 100 million bushels, leaving an increase in carryout from 2.1 billion to 2.24 billion bushels. We did see lower 2020-2021 ending stocks which was mostly anticipated by the trade estimates that were out there, primarily from a lower supply from 92 million acres down to the 84 million acres harvested. The yield was left unchanged.
There was a 15 million bushel increase in crush for 2019-2020 soybeans, bringing it to 2.155 billion bushels. Residual was adjusted from minus-4 million bushels to a minus-46 million, giving us negative 50 million bushels. This raised 2019-2020 soybean ending stocks from 585 million bushels last month to 620 million this month.
There was a little increase in soybean planted acres from 83.5 million to 83.8 million acres. Harvested acres went from 82.8 million to 83 million and the yield was unchanged at 49.8 bushels per acre. So, beginning stocks were higher due to higher production. Our crush was a little bit higher, up 15 million bushels and we ended up with a 425 million bushels carryout of new crop soybeans, up 30 million from last month.
All wheat ending stocks for 2019-2020 were raised, primarily due to a reduction in feed and residual domestic use. 2020-2021 was pretty much unchanged with an ending stocks number of 925 million bushels.