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USDA - WASDE FORECAST #549, January 12th 2015


Jan 15, 2016


The January USDA WASDE projections for the 2015 corn and soybean crops were lowered by 0.4 percent and 1.3 percent respectively. Ending stocks were up by 1.0 percent to 1,802 million bushels for corn and down 5.3 percent to 440 million bushels for soybeans.

The corn harvest was reduced to 13,601 million bushels based on a 0.9 percent reduction in yield to 168.4 bushels per acre. Area harvested remained at 80.7 million acres bushels. The “Feed and Residual”, “Food and Seed” and the “Ethanol and By-products (DDGS)” categories were only slightly changed as documented in the subsequent tables. Diversion of corn to ethanol was estimated at 5,200 million bushels or 33.8 percent of the projected availability despite projections of lower U.S. fuel demand. The increase in “Ending Stocks” by 17 million bushels was partly attributed to a 50 million bushel decline in the “Exports” category. The Stock-to-Domestic Use relationship increased numerically to 15.8 percent, from 15.0 percent in the November WASDE Report. The projected USDA farm price for corn was lowered by 5 cents per bushel on both ends of the range in the November WASDE Report to 330 to 390 cents per bushel.

The RFS for 2016 was set at 18.11 billion gallons by the EPA on November 30th. (See Editorial in CHICK-CITE). The value was 4 percent higher than the May 2015 proposal of 17.4 billion gallons. The supply of ethanol exceeds the U.S. demand by about 7 percent, based on a 10 percent blend rate, resulting in export of this commodity. Crude (WTI) oil fluctuated from $30 to $35 per barrel in December but is hovering at $30 per barrel in mid-January, despite the actions of OPEC and other producers. The prevailing low oil price reflects a slowing of World economic activity and increased oil and gas production in North America and unrestricted output from Saudi Arabia as factors determining the balance between supply and demand. It is noteworthy that China has displaced the U.S. as the largest importer of crude oil.


At the close of trading on January 13th, March and May 2016 corn traded on the CME at 356 cents and 360 cents per bushel respectively.

The area of soybeans harvested was reduced to 81.8   million acres. Yield was reduced fractionally to 48.0 bushels per acre with a production of 3,930 million bushels. The “Beginning Stocks” category remained at 191 million bushels with a supply of 4,150 million bushels down 5.3 million bushels. The ending stocks for soybeans declined by 5.3 percent to 440 million bushels. The USDA lowered the December WASDE projected ex-farm price for soybeans by 10 cents on either end of the range to 805 cents to 955 cents per bushel. At the opening of trading on January 13th CME quotations for soybeans for March and May delivery were 897 cents and 880 cents per bushel respectively.

Production of soybean meal was reduced 0.3 percent to 44.715 m tons. Projected soybean meal prices were reduced from $the December projection by $20 per ton to a range of $270 to $310 per ton. At the close of trading on January 13th, CME quotations for March and May 2016 soybean meal were $276 and $280 per ton respectively.

The price projections based on CME quotations for corn and soybeans suggest lower production costs for broilers and eggs.  Going forward, prices of commodities will be determined by World supply and demand and U.S. domestic use and exports.

For each 10 cents per bushel change in corn:-

     The cost of egg production would change by 0.45 cent per dozen

     The cost of broiler production would change by 0.25 cent per live pound

For each $10 per ton change in the cost of soybean meal:-

       The cost of egg production would change by 0.40 cent per dozen

       The cost of broiler production would change by 0.25 cent per live pound.

The USDA is able to provide a reasonably accurate projection of World supply and demand for coarse grains and oilseeds based on the status of crops in the Southern Hemisphere.  World production and use of coarse grains and oilseeds is summarized for the coming season:-

    Factor   m.tons.                            Coarse grains           Oilseeds      

Output                                                  1,262                     527

Supply                                                  1,505                     618

World trade                                             158                     148

Use                                                       1,201                     447

Ending stocks                                          245                      90    

(1 metric ton corn= 40 bushels)  (“ton” represents 2,000 pounds)




Harvest Area                                 80.7 m* acres (88.0m. acres planted, corresponding to 91.7% of area harvested)

Yield                                              168.4 bushels per acre (down 0.4 bushels from December 2015 WASDE Report)

Beginning Stocks                         1,731 m. bushels

Production                                  13,601 m. bushels

Imports                                              40 m. bushels

Total supply                                15,372 m bushels       Proportion of Supply 

Feed & residual                            5,300 m. bushels                34.5% 

Food & Seed                                 1,370 m. bushels                 8.9% 

Ethanol & byproducts                   5,200 m. bushels               33.8 % (Unchanged from December WASDE)

Domestic Use                              11,870 m. bushels               77.2%

Exports                                           1,700 m. bushels              11.1%  (Was 1,750 m bushels in Dec. WASDE)

Ending Stocks                                1,802 m. bushels              11.7 % (Was 1,785 m bushels in Dec. WASDE)

Stock-to- domestic use proportion    15.2%  (was 15.0 % in the December 2015 WASDE Report)

Average Farm Price: $3.30 to $3.90 per bushel. (Down 5 cents on both ends of the December WASDE range)






Harvest Area                                81.8m. acres (82.7 m. acres planted, corresponding to 98.9% of planted acreage )

Yield                                               48.0 bushels/acre (Was 48.3 bushels per acre in Dec. 2015 WASDE Report)

Beginning Stock                           191m. bushels

Production                                 3,930m. bushels

Imports                                           30m. bushels

Total Supply                              4,150m bushels        Proportion of Supply

Crushings                                  1,890m. bushels                45.5%

Exports                                      1,690m. bushels                40.7%

Seed                                                92 m. bushels                 2.2%

Residual                                          39 m. bushels                 1.0 %

Total Use                                   3,711 m. bushels               89.4%

Ending Stocks                               440m. bushels                10.6% 

Average Farm Price:  805 to 955 cents per bushel (Down 10 cents per bushel from 2015 WASDE Report)  

Soybean Meal

 Beginning Stocks                            260 m  tons

Production                                   44.715 m.  tons

Imports                                              325 m. tons

Total Supply                                 45.300 m. tons                           

Domestic Use                                33.300 m. tons

Exports                                          11.700 m. tons

Total Use                                       45.000 m. tons 

Ending Stocks                                      300 m. tons 

Average Price ex plant:  $270 to $310 per ton (Down $20 per ton on both ends of the range in the December  WASDE report)