By Kirk Maltais
--Corn for December delivery fell 1.9%, to $4.76 1/2 a bushel, on the Chicago Board of Trade on Tuesday, sinking after the USDA increased its outlook for U.S. corn production in today's WASDE report.
--Soybeans for November delivery fell 1.6%, to $13.46 1/2 a bushel.
--Wheat for December delivery rose 0.5%, to $5.87 1/2 a bushel.
HIGHLIGHTS
Steady Eddy: The USDA left its outlook for 2023/24 corn and soybean production relatively steady in today's WASDE report, which in turn sparked post-report selling. Corn production was lifted in today's report, while soybean production was cut less than expected by analysts surveyed by The Wall Street Journal. The lack of big changes in reaction to hot weather hitting crops in recent weeks has pressure on futures. "Nothing has changed the general paradigm," said Charlie Sernatinger of Marex in a note. "Now it's on to harvesting those crops."
Bouncing From the Bottom: U.S. wheat futures bounced off of recent lows midday, with traders reacting to the USDA's reduction in world wheat ending stocks by 7 million metric tons in 2023/24, bringing that figure to 258.61 million tons. Traders had expected a cut to this category, but not of this size, said Doug Bergman of RCM Alternatives in a note. Most-active wheat futures turned higher today after trading down 1.5% before the report's release.
INSIGHT
Eyes Forward: With today's WASDE report from the USDA being mostly conservative in the movement of crop outlook figures, some grain traders are wondering if October's report will contain a more comprehensive view of the state of crops. "You wonder 'do you have enough information from the plots?'" said Dave Marshall of AgTraderTalk.com. "Do we see the full impact of the late season dryness?" For U.S. corn, the USDA forecast that an increase in harvested acres would offset the decrease in the amount of corn per acre harvested.
In the Depths: Wheat futures on the CBOT found their lowest level in three years before the WASDE's release today, dropping to the lowest they've traded at since September 2020, with a dreary outlook for U.S. exports behind the dive. "Demand has been poor for U.S. wheat and should remain bad as Russia production looks strong and exports from Russia have not abated," said Jack Scoville of Price Futures Group in a note.
Shrinking Stocks: Ethanol stockpiles in the U.S. are forecast to drop back in this week's report from the EIA, analysts surveyed by the Journal say. Analysts project stocks anywhere from 20.9 million barrels to 21.54 million barrels for the week ended Sept. 8, versus 21.62 million barrels in last week's report. If inventories do sink below the 21 million mark, then it'll be the first time since 2021 that they've done so. The USDA kept its outlook for ethanol usage of corn unchanged in today's WASDE, at 5.3 billion bushels.
AHEAD
--The EIA will release its weekly ethanol production and stocks report at 10:30 a.m. ET Wednesday.
--The USDA will release its weekly export sales report at 8:30 a.m. ET Thursday.
--The U.S. Drought Monitor will release its updated map at 8:30 a.m. ET Thursday.
Write to Kirk Maltais at kirk.maltais@wsj.com
(END) Dow Jones Newswires
09-12-23 1507ET
