Instant Reactions to the November WASDE Report

The November WASDE report is here!

The November WASDE report is here!

Can’t you just feel the excitement?

What can we expect from today’s “most important WASDE report” ever?

Maybe. The December 2017 corn contract has been hovering below $3.50 with no news to break it past its support or resistance levels.

Here’s where grain markets moved 15 minutes before the November WASDE report…

Thanks, Barchart…

Now, is there anything else we need to know before the November WASDE report?

Oooookay….

Let’s get to the 12 p.m. announcement of the November WASDE report and instant reactions.

Sorry Corn Farmers… But…

We have a record corn harvest once again.

 

The production number hikes yield estimates to 175.4 bushels per acre. That figure was a 3.6-bushel increase from last month’s report. It also topped trader expectations by 3.0 bushels.

Total production increased by 298 million bushels compared to last month. The USDA pegged production at 14.578 billion bushels. That number also rattled traders since it topped trade expectations by about 245 million bushels.

Finally: What do carryout stocks look like?

The USDA hiked expectations by 147 million bushels to 2.487 billion bushels.

Fifteen minutes after the report, December corn prices slumped nearly 1%.

The front-month contract shed 3 cents and hit $3.4525.

No Change in Soybean Yields

 

Soybean yields were unchanged at 49.5 bushels per acre.

 

The average analyst expected a 0.3-bushel decline from last month’s figure. FarmLead CEO Brennan Turner said that it would remain the same in yesterday’s Breakfast Brief.

“I think there could be a bit more demand on the balance sheet, which is why I lowered my U.S. carryout estimate to 400 million bushels,” he said to explain his projection.

Carryout was actually a little higher than we had anticipated.

The 430 million bushels pegged in October was cut slightly.

The USDA slashed 5 million bushels from that figure, leaving us around 425 million bushels.

Total production came in at 4.425 billion bushels. That figure represented a downward revision of 6 million bushels.

It still topped trade expectations by about 13 million bushels.

The market didn’t like the fact that the USDA remained stubborn.

November soybean contracts dropped 3 cents and hit $9.85.

We’re a little more than 15 cents off in those November contracts from the day after the USDA released the October WASDE.

Wheat Stocks Slide, Prices Rise

 

There had to be some good news, right?

This month, it was good news for wheat prices.

The November USDA report indicated that U.S. ending stocks slid by 25 million bushels compared to the figure from last month.

Total carryout came in at 935 million bushels. That number was about 22 million bushels lower than trade expectations.

December SRW contracts added 2.25 cents on the news and hit $4.29. HRW contracts down in Kansas City added 1.25 cents and hit $4.2875.

MGEX December contracts in Minneapolis were up 5.25 cents and remained a tick below $6.49

What Else is in the November WASDE Report?

 

What happened in the cotton markets?

 

We’ll touch on that briefly later today. In addition, we’ll be taking a deeper dive into the report. We want to get a better sense of what the USDA expects for major producing nations like Russia, Brazil, and Argentina in the year ahead.

Check back at FarmLead Insights later today.

About the Author
Garrett Baldwin

Garrett Baldwin is a content strategist and editor at FarmLead. He covers the global grain markets and public policy issues related to the agricultural industry. He is a graduate of the Medill School of Journalism at Northwestern University. He also holds a Master’s Degree in Economic Policy from The Johns Hopkins University, an MS in Agricultural Economics from Purdue University, and an MBA in Finance from Indiana University.

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