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USDA Forecasts Larger Corn Stock

As U.S. farmers finish out their oldcrop financials, farmers in the Southern Hemisphere will soon be preparing for harvest. According to USDA’s World Supply and Demand Estimates released today, Brazil is expected to produce 152 million metric tons (MMT) of soybeans, unchanged from last month’s estimate, and 126 MMT of corn, also unchanged. USDA left Argentina’s crop production estimates untouched, with corn production estimated at 55 MMT soybeans at 49.5 MMT. While Brazil expects a bumper crop, farmers in Argentina are anxious. Planting is off to a slow start and yields may suffer due to hot, dry conditions in a third straight La Niña season.

USDA lowered expectations for U.S. corn exports by 75 million bushels, as buyers looked for cheaper supplies in early December. Lower demand meant higher endof-season corn ending stocks for the 2022-23 crop year. USDA held steady its estimate of U.S. soybean exports, but shipments could slow in the near future. For the second time this year, Argentina announced a one-month special exchange rate for soybeans to boost exports during a key U.S. exporting window. As a result, Argentine farmers have been pushing last season’s soybeans out as quickly as possible to take advantage of the new rate. While global demand for soybeans has been strong, increasing sales from Argentina will likely delay some shipments of U.S. beans; however, if China’s economy slows even more than it has, Argentina’s buoyant sales could displace some U.S. business.

The United States continues to face intense dryness, with extreme to severe drought stubbornly impacting the Great Plains, the Southwest, and California. Moderate drought to abnormally dry conditions have taken hold in much of the rest of the country. Farmers in Kansas, Nebraska, Minnesota, Iowa, and the Dakotas will be praying for a wet winter and spring. According to the National Oceanic and Atmospheric Administration, 89% of Nebraska’s topsoil moisture was rated short to very short in the first week of December, and 88% of South Dakota’s was rated the same.

December 9, 2022


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