USDA stocks surprise keeps corn and soybean coverage in focus

US corn and soybean ending stocks came in below trade expectations in Tuesday’s WASDE, although USDA also lowered its corn farm-price forecast. Corn and soybean meal benchmarks are essentially unchanged today; buyers should review coverage against delivery needs rather than assume the stocks surprise will immediately lift prices.

Grains

Corn is $204.84/mt, at 30% of its 52-week range. USDA put US ending stocks at 1,758 million bushels, 4.8% below the trade estimate, but cut its season-average farm-price forecast to $4.60/bu from $4.70. Corn export commitments through October 29 were 30% of USDA’s annual target, versus a 42% five-year average for the date.

Protein meals

Soybean meal is $429.34/mt, unchanged on the day, while USDA left its meal price forecast at $340/short ton; US soybean stocks were 9.7% below the trade estimate. Brazilian meal and oil demand has weakened after buyers stocked up, while dryness has halted soybean planting on some northern Mato Grosso do Sul farms. DDGS fell 2.1% and meat and bone meal fell 4.4% in the latest weekly quotes, both dated November 2; compare current delivered offers and nutrient values before substituting.

Fats and freight

Soybean oil is $1,548.11/mt, at 82% of its 52-week range; USDA cut its oil price forecast to 68¢/lb from 70¢. Choice white grease fell 5.2% in the November 2 weekly quote, making a fresh delivered comparison worthwhile where specifications permit. Diesel is $4.52/gal, up 76.1% year over year; the Missouri River navigation season ended early, so check affected delivery routes.

Feed cost

For the supplied week ending November 13, beef feedlot finisher rose most among the least-cost templates, up 0.8% to $172.40/tonne. Breeder production and swine finisher each rose 0.7%. Broiler grower rose 0.6% to $276.00/tonne; its stated one-week drivers were corn at +$1.48/tonne and soybean meal at +$0.21, with soybean oil and mix change effectively flat. These are re-solved template costs, not any mill’s actual costs.

Positioning and livestock

As of November 3, managed money remained net long 108,367 soybean meal contracts, at the 91st historical percentile, despite cutting the position by 60,347 contracts in the week. Lean hogs were $59.60/cwt on November 10, near the bottom of their 52-week range and down 30% year over year, leaving limited room for feed-cost increases in hog budgets.

Number of the day: 300 million bu

US soybean ending stocks. USDA’s projection was 9.7% below the trade estimate, a potential support for soybean and meal costs even though its meal price forecast was unchanged.