Updates in the October 2024 WASDE continued the overall fundamental market conditions in grains and soybeans (Table 1). Compared to the 2023/2024 marketing year, the factors of supply are increasing more than the factors of demand in 2024/2025. That results in an increase in the stocks-to-use ratio, measured here as estimated days of use on hand at the end of the marketing year [= ending stocks divided by (total use divided by 365)]. The days of use on hand measures how long we could get by next year on the crop that is left over from this year. An increase in the number of days of use on hand indicates a larger supply cushion in case of a production shortfall, which puts downward pressure on prices.
Table 1. WASDE: U.S. Supply and Demand
Focusing more specifically on each commodity:
Corn. USDA increased the national average corn yield this month from 183.6 bushels per acre in September to 183.8, an all-time record high. The biggest changes to the supply and demand balance sheet came from increases in use in old crop, lowering the beginning stock number for the 2024/25 marketing year by 52 million bushels. Domestic use categories in new crop corn were unchanged, but USDA increased exports by 25 million bushels.
World corn ending stocks were down slightly as the 1.6 million metric ton (mmt) increase in supply was exceeded by a 3.5 mmt increase in use.
While the supply and demand numbers for corn were mostly neutral, the increase in use is a bullish sign.
Wheat. The numbers for wheat in the October WASDE reflect crop information in the September Small Grains Summary: a small decrease in planted acres and yield. These changes lowered production slightly but were largely offset by an increase in imports. The only change in use was an increase of 10 million bushels for feed.
Only minor changes were made to estimates of world wheat supply and demand: supply down 1.9 mmt; use down 2.4 mmt; and ending stocks up 0.5 mmt.
The report was slightly bullish for U.S. wheat with a small decrease in estimated ending stocks and a reduction in the days of use on hand at the end of the marketing year, down from a 154-day supply last month to 150. But the U.S. only accounts for 7% of the world wheat supply. The stocks-to-use ratio for world wheat this month was higher.
Rice. Rice numbers were little changed this month, with a small increase in yield increasing supply and ending stocks.
World rice production is up 3.1 mmt this month primarily due to an increase in India. The largest rice exporter in the world, India’s rice exports increased from 18.0 mmt last month to 21.0 mmt. This is the second highest rice export number for India, just below the record 22.0 mmt in 2021/2022.
The report was neutral for U.S. rice supply and demand but bearish overall given the increase in foreign rice production with little change in use.
Soybeans. The national average soybean yield was lowered by 1/10th of a bushel to 53.1, still a record high. Along with this small change in production was a small increase in beginning stocks and small decrease in use. Ending stocks were unchanged.
The world soybean balance sheet was mostly unchanged: supply down 0.2 mmt; use down 0.3 mmt; and ending stocks up 0.1 mmt.
With virtually no changes to U.S. or world supply and demand numbers, the October WASDE was fundamentally neutral for soybeans.
Welch, J. Mark. “Recap of the October WASDE for Grains and Soybeans.“
Southern Ag Today 4(42.3). October 16, 2024. Permalink
