Year-end production report corn, soybean friendly

BLOOMINGTON, Ill. — The 2024 crop production summary turned the corn and soybean price trade screens green, including larger boosts for old crop.

Drops in corn and soybean yields were among other factors that fed the market after the release of the U.S. Department of Agriculture’s Jan. 10 production report.

Advance Trading’s Conner Bridgman, agricultural risk management adviser, and Brady Huck, risk adviser, hosted a livestream on X, formerly Twitter, as the numbers rolled out.

Bridgman: We saw a big pull-back in corn yield below 180 bushels per acre to 179.3. That’s 3.4 bushels below the November estimate — the average trade estimate was 182.7 — and below trend line. That’s a big hit in production numbers. That pulled ending stocks down to 1.5 billion bushels.

Soybean yields dropped to 50.7 bushels per acre from 51.7; the average trade estimate was 51.6. There was a decrease in soybean stocks, too, going from 470 million carryout to 380 million bushels.

Ending corn stocks went from 1.738 billion bushels to 1.54 billion, a decrease of almost 200 million bushels. That’s how fast things can change. The story is going to be this corn market. It’s nice to see this old crop rally.

There wasn’t a big increase in harvested area. It was increased ever so slightly. In the December World Agricultural Supply and Demand Estimates report, harvested acres were at 82.7 million aces and this report went to 82.9 million.

It’s a nice, friendly report for both corn and soybeans.

Huck: We saw the corn and soybean ending stocks drop again. I saw a stat on corn that this is like five or six times in a row that ending stocks were reduced in the USDA report.

We’ve got an old crop story with those tight stocks, but that 94 million, 95 million acres of potential U.S. corn planting that could come around the corner, the trade’s not worried about next year quite yet, and we’ve got Brazil’s safrinha corn crop that’s going to be right behind this.

So, you have two significant corn crops over the coming this year that could bail us out of this tight situation. But the market is definitely a little nervous about the near term, that 1.5 billion bushel U.S. carryout supply.

It’s an old crop market right now and that’s how I see the importance of staying in the game with the current crop that you have marketing. We talk about always being long that next crop.

Well, the next crop is not rallying right here. We have an old crop market and new crops just dragging its feet up with it.

Brazil soybean production stayed the same at 169 million metric tons.

Bridgman: We didn’t see the 170 million metric tons in Brazil, so, I think that’s additionally fueling this soybean market.

If we go back to last year, the final yield was 177 bushels per acre. Everything that we saw through 2024 and these great growing conditions, where do the yields pop out? Do we see 184 bushels?

Now we dropped it almost 4 bushels on this last report. I made a few jokes about it’s going to be a record unless we see something dramatic.

It’s still a record crop, 179 bushels per acre, but only 2 bushels better than last year. There was a big pullback on overall corn yield.

Huck: At the end of the day, these USDA numbers may be precise, but they’re wrong. They’ll change.

Bridgman: I don’t understand one thing. If there’s no change on Brazil and Argentina production and the stocks-to-use ratio is 0.24% smaller, how come prices are going up?

Huck: I think it’s the domestic number. We saw U.S. carryout trimmed quite a bit. I said bullish numbers, bearish reaction, but also we could see maybe on paper a bearish number, bullish reaction.

Everyone was predicting we were going to see 170, 170.5, 171 million tons of soybeans out of Brazil and USDA didn’t give it to us.

That kind of fuels the fire. It’s one of those bullish domestic numbers, not necessarily bearish South American numbers.

World ending stocks on soybeans had an average estimate going into the report of 132.2 million metric tons and it came in at 128.37 million. The trade was looking for it to go up and it went down.