AgriVisor Morning MarketWatch

Monday, October 12, 2020
There is little doubt we will again see trade surround the WASDE soybean figures from last Friday. The USDA is now projecting a 290 million bu new crop carryout on soybeans which is a level that would warrant price rationing. Soybean values have already rallied considerably in recent weeks though, and we are now trying to determine how much more needs to be done. Now that the monthly WASDE report is out of the way, trade will return its attention to daily harvest reports and usage updates for price discovery. We will receive the updated harvest numbers this afternoon and a considerable jump in progress is expected. Once harvest gets underway and it appears there are not going to be major disruptions, trade becomes less interested in progress and more in yields. We continue to hear mixed reports on the crops, but in general, it appears as though crop sizes will meet and possibly exceed USDA estimates. Trade is also becoming more interested in what is being done with new crop bushels. A large number of soybeans were marketed right out of the field given the lack of carry in futures, but this has now slowed. The question now is if there is enough storage for the remainder of harvest or if producers are waiting to decide which crop to sell and which one to store. 

* Trade to continue to sort through WASDE outlooks 
* Hurricane Delta damage being assessed
* SAM weather appears better
* US harvest pressure to build
* Trade looking forward to more flash sales
* Economic stimulus remains uncertain
* World food values +5% last year
* Rumors of Chinese ethanol demand
* Average US corn values estimated $3.80
* Average US soy value estimated $9.80

* Corn yield projected 178.4 bpa, crop at 14.72 bbu
* US ending stocks 2.167 bbu
* Global ending stocks 300.5 mmt 
* US acres decrease 1 million
* US corn becomes overvalued in global market
* Yield projected at 51.9 bpa, crop at 4.27 bbu
* US ending stocks 290 mbu
* Global ending stocks 88.7 mmt
* US acres down 700,000 
* High values encourage SAM plantings
* US production 1.83 bbu
* US ending stocks 883 mbu
* Global carryout 321.5 mmt
* US Plains see building drought
* Winter wheat plantings continue to rise
* 2020 US beef production 27.138 billion pounds
* 2021 US beef production 27.4 billion pounds
* 2020 US pork production 28.2 billion pounds
* 2021 US pork production 28.5 billion pounds
* 2020 US beef prod +90 mil pounds, Pork -80 mil

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