USDA, trade estimates not far off

CHARLOTTE, Mich. — Prospective planting and quarterly grain stock numbers released March 31 were at or near expectations and primarily already priced into the market.

Angie Setzer and Karl Setzer, copartners at Consus Ag Consulting, looked at the new numbers when they hosted a live podcast on X, formerly Twitter, when the U.S. Department of Agriculture’s reports were released.

The prospective plantings report showed a shift to more corn and less soybean and wheat acres. How did the numbers compare to prereport expectations?

Angie Setzer: Corn acres came in at 95.326 million, about 1 million higher than the average trade estimate, but in line of what traders were expecting ahead of the report. I think most everyone had baked in that above 95.5 million acres would have been not supportive to price by any means.

Soybeans came in at 83.5 million acres, and traders were expecting 83.762 million. So, a little lower than what traders had anticipated. The USDA Ag Outlook Forum had them at 84 million.

I think traders thought that we were going to see a really sharp reduction in new crop acres that would be the shot in the arm that soybeans needed. It looks like we’re going to plant soybeans and forsake wheat.

All wheat acres came in much lower than what traders were expecting at 45.35 million acres. Trade anticipated 46.5 million.

Winter wheat came in about 600,000 to 700,000 acres lower than what was anticipated. Spring wheat came in 500,000 acres lower than anticipated. Durum came in right around trade expectations.

The quarterly stocks estimates are based on March 1 on-farm and off-farm storage and marked the mid-point of the 2024-2025 marketing year.

Karl Setzer: Corn stocks in all positions at 8.15 billion bushels is down 2% from March a year ago and in line with expectations. There were 4.5 billion bushels on-farm, down 11% from a year ago, and off-farm stocks of 3.65 billion, were up 12% from a year ago.

Soybeans in all positions were 1.91 billion bushels, a little higher than what traders were expecting, about 9 million bushels, so not much of anything.

All wheat quarterly stocks were 1.24 billion bushels, up 14% from a year ago, about 30 million bushels higher than was traders were expecting. That’s really not a market-breaker.

That was well within the range of what was expected. On-farm was 307 million bushels, up 13% from a year ago.

Angie Setzer: In corn, one of the things we had talked about ahead of these numbers was that the spreads had indicated or potentially could indicate that maybe we had more corn out there than we thought.

There was a lot of thought that we could see potentially a larger than anticipated stocks number in the corn today. My argument has kind of been the pace of off-farm selling that would be behind it. So, one of the things I was wondering is what are we looking at on-farm for corn stocks.

Karl Setzer: Again, corn stocks in all positions, 8.15 billion bushels, down 2% from March a year ago. There was 4.5 million bushels stored on-farm, down 11% from last year.

Angie Setzer: So, pretty significant shift at least on that side.

What are your thoughts about these numbers going forward?

Karl Setzer: We’ll trade this report for the next 15, 20 minutes and we’re probably going to be back to weather after that and actual planting conditions.

Angie Setzer: We’ve got the tariffs, we’ve got the weather, we’ve got these numbers and the fact there really isn’t a surprise in them outside of maybe the wheat acres. But I guess $5 per bushel wheat doesn’t really encourage anyone to do anything with it.

The USDA will now use these acreage numbers for the initial outlook. We’ll get these acreage numbers in May and June with the USDA Ag Outlook Forum’s trend line yield projections.

Now you’ll get to have a bunch of folks toss at us the carryout using these numbers, in that 2.2 billion, 2.3 billion bushel carryout area for corn. That is something that the market has really been kind of, I feel, digesting for a while now.

That leads to Karl’s point where we start to pay attention to the weather, start to watch and see what happens as we work our way into planting and beyond. We’ll be watching South American weather and so many other of these factors. We’ll see what the tariffs look like and what the response will be.