March 07, 2021

Global demand continues to lower U.S. ending stocks

WASHINGTON — Corn and soybean ending stocks continued their downward trend in the U.S. Department of Agriculture’s supply and demand estimates report.

Here are the highlights.

Corn: The season-average price projected to be received by producers was increased by a dime to $4.30 per bushel. Why?

• Exports were increased by 50 million bushels, reflecting historically large corn purchases by China.

• With no other use changes, U.S. corn ending stocks were lowered 50 million bushels from last month to 1.502 billion bushels, the lowest carryout in seven years.

• The lower carryout reduced 2020-2021 stocks-to-use to 10.3%, also a seven-year low, and down from 13.7% in 2019-2020.

• Global coarse grain production for 2020-2021 is projected marginally higher to 1.438.9 billion tons. This month’s foreign coarse grain outlook is for higher production, lower consumption and greater ending stocks relative to last month.

• Major global trade changes for 2020-2021 include higher projected corn exports for the United States, India and South Africa.

• For 2019-2020, Argentina and Brazil corn exports were increased for the local marketing year ending February 2021 based on larger-than-expected late-season shipments. Corn imports for 2020-2021 were increased for China.

• Foreign corn ending stocks for 2020-2021 are up relative to last month, mostly reflecting increases for China, South Africa and Mexico that are partly offset by reductions for Argentina and Brazil. Global corn ending stocks, at 286.5 million tons, are 2.7 million higher than last month.

Soybeans: The U.S. season-average price for 2020-2021 was unchanged last month at $11.15 per bushel. Why?

• U.S. soybean exports are projected at 2.25 billion bushels, up 20 million from last month reflecting record marketing year exports through January and a slow start to Brazil’s export season resulting from harvest delays.

• With crush unchanged, soybean ending stocks were lowered by 20 million bushels to 120 million. If realized, soybean ending stocks would be down 77% from 2019-2020 and the lowest since 2013-2014.

• Global 2020-2021 soybean supply and demand forecasts include higher exports and lower ending stocks.

• Brazil and Argentina soybean production were unchanged from last month at 133 million metric tons and 48 million metric tons, respectively.

• Global exports were increased by 0.6 million tons to 169.7 million on higher exports from the United States and Russia.

• Higher imports for Argentina were partially offset by reductions for the EU27 and U.K., Canada and Bangladesh.

• Global soybean stocks were reduced 1 million tons to 83.4 million as lower stocks in the U.S. and Brazil more than offset higher stocks in Argentina.

Wheat: USDA increased the season-average farm price by 15 cents per bushel to $5. Why?

• The 15-cent increase is based on the National Agricultural Statistics Service prices reported to date and expectations for futures and cash prices for the remainder of the marketing year.

• Hard red spring wheat and white wheat exports were raised on stronger than expected sales and shipments, particularly to China. Hard red winter wheat exports were lowered on a continued slow pace.

• All wheat exports were unchanged from last month at 985 million bushels, 20 million above 2019-2020 levels.

• Durum and hard red spring wheat food use were increased while hard red winter and soft red winter are lowered.

• All wheat use was unchanged at 2.138 billion bushels.

• Global wheat supplies were raised by 0.8 million tons to 1.073.5 billion. Global production was increased to a record 773.4 million tons.

• China’s 2020-2021 feed and residual use was increased to a record 30 million tons, surpassing the previous 2012-2013 record of 26 million. China’s domestic corn prices continue to be at a premium to wheat, encouraging greater wheat feed use.

• Additionally, increased auction volumes of old-crop stocks in China have expanded the availability of feed-quality wheat.

• The largest import change this month is for China, where imports were raised to 10 million tons on a continued robust pace.

• Projected 2020-2021 world ending stocks were lowered by 9 million tons to 304.2 million with most of the reductions due to increased consumption for China and India. However, global stocks remain record high with China and India holding 51% and 9% of the total, respectively.

Corn (2020-2021 marketing year):

Total corn supply: 16.127 billion bushels

Exports: 2.6 billion bushels

Feed, residual use: 5.65 billion bushels

Food, seed, industrial use: 6.375 billion bushels

Ethanol and byproducts: 4.95 billion bushels

Ending U.S. corn stocks: 1.502 billion bushels

Soybeans (2020-2021 marketing year):

Total soybean supply: 4.695 billion bushels

Seed, residual: 125 million bushels

Exports: 2.25 billion bushels

Crush: 2.2 billion bushels

Ending U.S. soybean stocks: 120 million bushels

Tom Doran

Field Editor