June 12, 2024

Grain prices down in USDA’s first look at new crop projections

WASHINGTON — The U.S. Department of Agriculture provided a first look at the 2023-2024 supply-and-demand prospects in its May 12 report.

Here are the highlights of the new crop balance sheets.

Corn: The season-average farm price for 2023-2024 is projected at $4.80 per bushel, down $1.80 from 2022-2023. Why?

• The corn crop is projected at a record 15.3 billion bushels, up more than 10% from last year on increases to both area and yield.

• The yield projection of 181.5 bushels per acre is based on a weather-adjusted trend assuming normal planting progress and summer growing season weather, estimated using the 1988-2022 time period.

• With beginning stocks up slightly, total corn supplies are forecast at 16.7 billion bushels, the highest since 2017-2018.

• With total U.S. corn supply rising more than use, 2023-2024 ending stocks are up 805 million bushels from last year and if realized would be the highest in absolute terms since 2016-2017. Stocks would represent 15.3% of use, the highest since 2018-2019.

• Total U.S. corn use for 2023-2024 is forecast to rise about 5% relative to a year ago on higher domestic use and exports.

• Food, seed, and industrial use is projected to rise 55 million bushels to 6.7 billion.

• Corn used for ethanol is projected to increase 1%, based on expectations of modest growth in motor gasoline consumption and ethanol’s inclusion rate into gasoline.

• Feed and residual use is projected higher on a larger crop and lower expected prices.

• U.S. corn exports for 2023-2024 are forecast to rise 325 million bushels to 2.1 billion, as lower prices support a sharp increase in global trade following the decline seen during 2022-2023. U.S. market share is expected to increase slightly, while remaining below the average of the past five years.

• Despite a rebound in U.S. exports, Brazil is forecast to be the world’s largest exporter of corn for the second consecutive year

• Global corn ending stocks are up 15.5 million tons to 312.9 million, mostly reflecting larger stocks for the U.S. that are partly offset by declines for Brazil and China.

Soybeans: USDA forecasts the 2023-2024 season-average farm price at $12.10 per bushel, compared to $14.20 per bushel in 2022-2023. Why?

• The soybean crop is projected at 4.51 billion bushels, up 5% from last year’s crop, mainly on higher yields.

• With lower beginning stocks partly offsetting increased production, soybean supplies are forecast at 4.75 billion bushels, up 4% from 2022-2023.

• The U.S. soybean crush for 2023-2024 is projected at 2.31 billion bushels, up 90 million from the 202-2023 forecast on favorable crush margins and strong demand for soybean oil as a biofuel feedstock, which is projected to increase 900 million pounds to 12.5 billion.

• Domestic soybean meal disappearance is forecast to increase 2% from 2022-2023 on lower soybean meal prices and modest growth primarily in poultry production.

• U.S. soybean meal exports are forecast at 14.8 million short tons, leaving the U.S share of global trade slightly above the prior five-year average.

• U.S. soybean exports are forecast at 1.98 billion bushels, down 40 million from 2022-2023 with strong competition from increasing South American production and limited gains in global import demand.

• U.S. ending stocks for 2023-2024 are projected at 335 million bushels, up 120 million from the revised 2022-2023 forecast.

• Global 2023-2024 soybean ending stocks are estimated up 21.5 million tons to 122.5 million, with most of the increase for Brazil, Argentina, U.S. and China. The ending stocks figure includes mid-season stocks (September 30, 2024) for Brazil and Argentina and reflects growing supplies leading into the 2024 U.S. export season.

Wheat: U.S. projected 2023-2024 season-average farm price is $8 per bushel, down 85 cents from last year’s projection. Why?

• U.S. wheat supplies are forecast lower than last year with smaller beginning stocks and only slightly larger production.

• All wheat production is projected at 1.659 billion bushels, up modestly from last year on increased harvested area. However, the harvest-to-plant ratio is down from last year with above-average abandonment in Texas, Oklahoma, and Kansas.

• The all wheat yield, projected at 44.7 bushels per acre, is 1.8 bushels lower than last year.

• The first survey-based production forecast for 2023-2024 winter wheat is up 2% from last year as higher soft red winter production more than offsets a decline in hard red winter and white wheat.

• Total 2023-2024 domestic use is projected at 1.112 billion bushels, up 1% from last year, primarily on increased feed and residual use.

• U.S exports are projected at 725 million bushels, 50 million lower than last year.

• Domestic ending stocks are estimated at 11% lower than last year and the lowest in 16 years.

• Estimated world consumption at 791.7 million tons is 3 million lower compared with last year on reduced feed and residual use.

• Projected global ending stocks for 2023-2024 are down 1.9 million tons to 264.3 million. Stocks are forecast to decline in Russia and the EU but increase in China and India. If realized, this would represent the lowest global stocks-to-use ratio since 2014-2015 with more than half of global stocks held in China.

Corn (2023-2024 marketing year)

Total corn supply: 16.707 billion bushels

Exports: 2.1 billion bushels

Feed, residual use: 5.65 billion bushels

Food, seed, industrial use: 6.735 billion bushels

Ethanol and byproducts: 5.3 billion bushels

Ending U.S. corn stocks: 2.222 billion bushels

Soybeans (2023-2024 marketing year)

Total soybean supply: 4.745 billion bushels

Seed, residual: 126 million bushels

Exports: 1.975 billion bushels

Crushings: 2.31 billion bushels

Ending U.S. soybean stocks: 335 million bushels

Tom Doran

Tom C. Doran

Field Editor