A friendly corn report
USDA released the April supply and demand information on Friday with the corn report a bit friendlier than expected.
Corn carryout was cut to 1.352 billion bushels. There was an increase across the board in domestic demand and exports were increased 75 million bushels.
“They increased feed by 50 million bushels and increased ethanol by 25 million bushels,” said Garrett Toay of Ag Trader Talk in northwestern Illinois.
The ethanol numbers are a bit of a surprise because this is the first month we were able to outpace last year’s pace.
“There are positive signs in the ethanol market,” Toay observed.
More ethanol demand is coming, according to Toay. Prior to the USDA report, December corn set contract highs. There was some farmer selling on Friday but it wasn’t heavy.
Everyone will be watching the forecast over the next few weeks for corn planting, although there may not be much downside risk until the June report, which is typical for that time of year.
For soybeans, USDA increased exports and cut seed, residual and crush.
“They are anticipating the crush is going to get crimped here with reduced margins,” said Toay.
Bean exports were increased by 30 million bushels because our commitments have already been booked. At the same time, Brazil’s soybean production was increased by two million metric tons and Chinese imports were unchanged.
“At face value, that gave us a bigger world soybean stocks number than what the trade was looking for.”
Toay was our guest on Friday’s CIFN Midday Update. For more information, visit www.agtradertalk.com or call 815-745-2020.