Prices for corn, wheat and soybeans significantly under pressure

US Department of Agriculture (USDA) published its crop forecasts yesterday. The estimates for the corn and soybean crops in the US significantly exceeded the market's expectations. The production estimate for US soybeans was revised up 31 million bushels to 3.916 billion bushels. Down 0.9 million acres, the harvested soybean acreage was slightly below the forecasts published in July, but this would nonetheless imply a record 83.5 million acres, notes Commerzbank. US ending stocks were upwardly revised by 45 million to 470 million bushels. 

The price of US soybeans plunged by more than 6% yesterday in response to the published figures and closed at 910 US cents per bushel. The USDA raised its forecast for US corn production by 156 million to 13.7 billion bushels. As a result, corn ending stocks are expected to climb to 1.7 billion bushels - in other words by 100 million bushels more than the USDA had previously envisaged. 

The corn price fell by 5% in response and closed trading at 357 US cents per bushel. Corn production has proved significantly poorer outside the US, however - especially in China and the EU - with the result that the USDA reduced its estimate for the global corn crop by a full 1.5 million tons. Despite lower than expected (winter) wheat production, the USDA has increased its estimate for US ending stocks by 8 million to 850 million bushels. This is due to lower US wheat exports. The wheat price responded by shedding just shy of 3% to 497 US cents per bushel.