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Bearish news in USDA report, analyst says

by 5m Editor
19 January 2006, at 12:00am

US - As expected, the USDA Stocks and Crop Production report on Thursday contained a lot of bearish data for soybeans, and the corn market could be pressured as well, Shawn McCambridge, Prudential Securities, told Agriculture Online. In its Thursday report, USDA released higher than expected U.S. corn stocks on hand as of Dec. 1, 2005 at 9.813 billion bushels. &quot;This indicates lower use for the first quarter of this year,&quot; McCambridge said. When looking at the U.S. corn balance sheet, the USDA increased corn production by 80.0 million bushels. To offset a higher production figure, the corn feed and residual was increased by 125 million bushels from the last report. &quot;That whole mix of numbers only put ending stocks up by 7.0 million bushels, but we&#39;re still at 2.426 billion bushels that the U.S. is expected to have on hand for August 2006. &quot;That is too much,&quot; McCambridge said. &quot;That is certainly negative for the market.&quot; The world corn balance sheet is bearish looking as well, McCambridge said. USDA increased China&#39;s corn crop by 4.0 million metric tons. With the U.S. changes the world corn ending stocks for 2006 is at 128.26 million metric tons. For soybeans, USDA estimated 2005-2006 U.S. ending stocks at 500 million bushels, indicating more than abundant supplies. For U.S. soybean stocks on hand as of Dec. 1, 2005, USDA estimated 2.502 billion, above analyst&#39;s estimates of 2.44 billion. The usage side of the U.S. wheat balance sheet was virtually unchanged. However, the total U.S. wheat production was bumped up 7.0 million bushels and imports by 5.0 million. &quot;This means we did add to the U.S. ending stocks,&quot; McCambridge said. &quot;USDA&#39;s U.S. wheat ending stocks estimate of 542 million bushels is still adequate to our needs.&quot; U.S. wheat seedings for 2006-2007 estimated at 41.3 million acres was lower than an expected 42.4 million. &quot;That could give the Kansas City wheat market some support,&quot; McCambridge said. <i>Source: Agriculture.com</i>

5m Editor