Nelson Analyzes USDA Quarterly Grain Stocks, Sees Shifting Supply Balances

Rich Nelson of Allendale analyzed the USDA's quarterly grain stocks and small grains summary with Farm Director KC Sheperd, outlining the shifting supply balances that affect wheat, corn, and soybean marketing decisions. The USDA finalized U.S. all-wheat production at 1.534 billion bushels, up roughly 3 million from previous estimates. First-quarter disappearance was stronger than expected, with September 1 wheat stocks pegged at 1.85 billion bushels, below trade expectations of 1.87 billion.

Nelson pointed out that U.S. wheat production fell by more than 400 million bushels year-over-year, but first-quarter wheat-for-feed usage dropped by only 46 million bushels. The market has not sustained a supply-driven rally due to steadily stripped-out geopolitical risk premiums regarding the Black Sea and lack of significant export sales from Russian and Ukrainian concerns.

For corn, old-crop ending stocks totaled approximately 2.1 billion bushels, exceeding trade estimates by 177 million bushels. This larger carry-in expands new-crop ending stocks into the 1.7 to 1.8 billion bushel range. Nelson indicated that an ongoing lag in new-crop export commitments could pressure December futures toward $4.75.