USDA Supply and Demand Report - Mixed calls; where do we end?

Markets are called mixed today behind a mixed USDA Supply and Demand Report.

Most of the calls I have seen are for wheat and beans unchanged to up 10 ish and corn unchanged to down 10 or so.

Below are the numbers; first with the estimates, then last month’

S and with the actual highlighted in green

US corn carryout at 720 million bushels versus 801 last month – Actual  801 million bushels

Soybean carryout in the US at 245 versus 275 last month – Actual  250 million bushels

Wheat carryout in US at 790 versus 845 last month – actual 793 million bushels

World corn carryout at 122.45 million metric tons versus 124.53 last month – actual 122.70 million metric tons

Bean carryout in the world at 55.42 versus 57.3 last month – actual 55.52 million metric tons

Wheat  carryout in the world at 208.62 versus 209.58 last month – actual 206.27 million metric tons

Calls for corn tend to be weaker because of the fact that the market was expected a decrease in our ending stocks; but instead the USDA did the same thing it did last year and left the balance sheet unchanged despite the friendly USDA March stocks report.  The bulls will say that the USDA just simply isn’t willing to print a tighter balance sheet and mention the fact that spreads are extremely firm and basis is over delivery values in many areas; which is a sign of a lack of supply. 

Keep in mind that it is much more important how we close then how we open.

For the beans the numbers are friendly but not exactly a lot above estimates so I think it leaves the door open for a sell off because of the huge length that the funds have.  But as I mentioned yesterday I thought beans where over priced a dollar or two ago.  So if that freight train to keeps going one shouldn’t be surprised.

Wheat even though we cut carryout a little in the US and the world; I don’t expect a major move from this report.  With the funds short perhaps we could see a spike at any time; but we still have plenty of wheat despite the fact that ending stocks where cut in both the US and in the world.  Maybe sometime later wheat will have a story; but right now it is still a follower.  Possible freezes in our area as well as other parts of the US could help support the market at any time and provide a bullish tune for corn as well; plus it still is very dry in Europe and that could allow for wheat to slowly trim it’s burden some balance sheet at some point giving it a bull story.

Outside markets are acting a little poor since the grain markets paused their session this a.m.

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