Corn and soybeans jumped higher on surprisingly lower carryouts printed in the January WASDE Report. Both came in lower than last month even though demand was cut on both balance sheets. USDA also cut harvested acreage in both, but the big cut was in corn losing 1.6 million acres which dropped production by 200 million bushels even with yield rising a bushel per acre to 173.3. Corn usage was cut by 185 million bushels with most of those 150 million bushels out of exports. Soybean yield was cut by .07 bushels to 49.5 and acreage cut by 300K acres to drop production by 70 million bushels. Take usage cuts of 59 million bushels and the carryout dropped to 210 million bushels.
In Sout America, the USDA cut Argy corn by 3 MMT & soybeans by 4 MMT which likely will need to be trimmed more going forward as the USDA is on the high end of estimates even with these cuts. They cut Brazil’s corn by 1.5 MMT (surprise) but bumped soybeans to 153 MMT up 1MMT. This 153 level is a current consensus area among many entities.
Bottomline: We will have to watch the follow through into early next week to see if we can sustain these price levels. Will need to see technical buyers come in because unless we get more bullish news between now and next week we could be right back where we started this morning. NFC Grain Afternoon Comments. (12)