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CME: Analysts Expect Small Changes For Yr-End Estimates

by 5m Editor
12 September 2011, at 6:29am

US - Reuters has released the results of its survey of analysts regarding USDA’s September Crop Production and World Agricultural Supply and Demand Estimates which will be released on Tuesday, write Steve Meyer and Len Steiner.

While those reports cover a wide range of crops and contain a plethora of data, the key items that will be watched this month are estimates of 2011 year end carryout stocks and 2011 yield and crop size estimates.

The table below summarises Reuter’s key numbers. Note that the 2010-11 marketing year for wheat ended 31 May so no estimates are included for that crop. The June Grain Stocks report pegged year-end 2011 wheat stocks at 861 million bushels. The 2011-12 marketing year for wheat ends at the end of May 2012 while the 2011-12 marketing year for corn and soybeans began 1 September and runs through next August.

Analysts expect only small changes in USDA’s estimates for 2011 year-end corn and soybean stocks with a slight increase expected for corn and a slight decrease expected for soybeans.

Lighter hogs, some reductions in chicken numbers and a slowing pace for exports were expected to reduce crop year Q4 usage and leave a bit more corn in storage.

The important news on year-end stocks, though, are the expectations for the coming year. USDA already had forecast low 2012 year-end stocks for all three of the products shown here but analysts expect all three numbers to be lowered even further in Monday’s reports.

The largest expected decline is for corn stocks which analysts expect to fall by 78 million bushels. Should the average analyst estimates be correct, 2012 year end stocks for both corn and soybeans will be one-third smaller than at the end of the 2010-11 marketing year on 31 August.

Every surveyed analysts expects USDA’s estimate for this year’s corn yield to be lower than its August estimate of 153 bushels per acre. The average of analyst corn yield estimates, 149.1 bushels/ acre is almost four bushels or two per cent lower than USDA’s August estimate.

It would also be over eight bushels below the 1960-2010 yield trend’s 2012 value of 157.3 bushels/acre. The average estimate for the US corn crop, 12.491 billion bushels, is less than one per cent lower than USDA’s August estimate of 12.519 billion bushels.

Survey averages for yield and crop size hardly ever fit together perfectly due to different assumptions regarding harvested acres on the part of the analysts that are surveyed. These averages for yield and crop size, though, suggests that USDA’s harvested acres number would increase slightly from August’s 84.4 million acres. We don’t expect that to actually happen but the relative sizes of yield and crop sizes say it might be so.

Analysts also expect lower estimates for the national soybean yield and crop size but these soyben expectations are not nearly as different from USDA’s August estimates as re those for corn.