USDA’s balance sheet mirrors last month

CHARLOTTE, Mich. — With two potential supply and demand movers slated for the end of the month, the U.S. Department of Agriculture’s March 10 balance sheets were unchanged as expected.

“The March report is typically a number that we don’t do too much with. We don’t usually have big expectations coming into it and today is no different,” Angie Setzer, Consus Ag Consulting copartner with Karl Setzer, said on a live podcast on X when the USDA’s ag supply and demand estimates report rolled out.

Were USDA’s domestic balance sheets near the trade pre-report expectations?

Angie Setzer: On the soybean side, the trade expected a carryout of 344 million bushels, down 6 million from last month. The thought was we could see some higher crush numbers, maybe some higher exports, though they could reduce exports, too. USDA kept carryout at 350 million this month.

Traders weren’t expecting much in the way of big adjustments on the corn side either. The average trade guess was 2.136 billion bushels from 2.127 billion last month. The majority of folks were expecting the number to say relatively unchanged. Ending stock in this report were unchanged at 2.127 billion.

Wheat carryout was expected to come in around 926 million bushel. That was 931 million last month.

There was a thought there that we should see an increase in wheat exports and then a subsequent reduction in carryout, potentially 5 million bushel, nothing big there. However, there were no changes on the wheat side in this report.

The only changes of note were on the global crop balance sheets.

Karl Setzer: Global corn carryout was up a little bit at 292.75 million metric tons, the trade expected 289.20 million and it was 288.98 million last month.

USDA bumped up Brazil corn production by 1 million metric tons to 132 million. Ukraine corn production was raised from 29 million to 30.7 million metric tons.

World soybean carryout was 125.31 million metric tons. We were a little higher than the 124.70 million estimated by the trade heading into this report. Carryout was 125.51 million last month.

Brazil’s soybean crop held at 180 million metric tons. The Argentine soybean crop was cut to 48 million metric tons, down from 48.5 million last month.

So, all things considered, it’s a little bit on the friendly side at least on the global numbers, but nothing that’s going to change the market turn from what I’m seeing so far.

We’re really not seeing too many changes other than just fine-tuning. That’s really all it is.

The Australian wheat crop was cut 1 million metric tons. That’s a little surprising after the reports we’ve gotten out of there.

What was the market’s initial reaction to the March report?

Angie Setzer: The market response is just a continuation of where it was prior to the numbers coming out.

The initial reaction is corn down 5 cents. Soybeans are up 4 or 5 cents. Most everyone right now is going to look at this and be like, there was a report today?

So, to see USDA kind of phone it in isn’t overly surprising. I shouldn’t even say phone it in. The numbers meet what is going on out there. There’s nothing out there that says they should have made a big adjustment.

Market response? It doesn’t even know there’s a report out there.

USDA will release its quarterly stocks and prospective plantings reports March 31. What are your thoughts on those upcoming reports?

Angie Setzer: The biggest thing I’d say about acres is that there is a risk there that the acreage number could show some thoughts that may not maintain their way through the month, depending on how we see fertilizer and everything else play out.

So, at the month’s end we’ll have quarterly stocks and acres, and in the meantime we’ll pay more attention to geopolitics, the flow of grain, what we see happen with energy and all of those fun things that we’re keeping an eye on. President Donald Trump is meeting with China’s President Xi Jinping in China on March 31.

Overall, from a USDA sort of standpoint, today’s a non-event, no real big changes there, and we’ll just be watching money flow and see what cash does in the short term.