Supply and Demand Report Recap

John M. Riley, Extension Economist
By John M. Riley, Extension Economist March 10, 2012 16:47

USDA released their monthly World Agricultural Supply and Demand Estimates report on Friday (Mar 9). With respect to crops, the report continues to project production and use for the 2011/12 marketing year which encompasses the 2011 crop. Therefore, the United State’s production estimates are mostly concrete by this point and thus only demand values fluctuate.

Grains/Oilseeds:
This month analysts’ forecasted ending stocks for corn, soybeans and wheat were 785, 260, and 836 million bushels respectively. Both corn and soybean values reported by USDA were unchanged from February’s at 801 and 275 million bushels, respectively, and therefore above the pre-report estimates. Wheat ending stocks were lowered from February by 20 million bushels to 825 largely due to increased wheat exports.

Globally, analyst expected ending stocks for corn, soybeans and wheat to be 123.49, 57.758, and 212.608 million metric tons (MMT), respectively. The report showed that world corn ending stocks are currently projected at 124.53 MMT versus 125.35 in February, but not as low as analyst expected. The slight decrease cannot be attributed to any one leading factor and was a result of some shuffling of values across a number of countries. Global soybean ending stocks are currently projected at 57.30 million metric tons versus 60.28 last month and marginally lower than pre-report expectations. The decrease is related to the weather issues in South America as Brazil and Argentina’s production were cut by 3.5 and 1.5 MMT, respectively. World wheat ending stocks are currently projected at 209.58 MMT versus 213.10 last month, and below expectations. The lower wheat stocks is mostly due to lower carry-over in China as well as increased use in the country.

Cotton:
U.S. cotton ending stocks were raised by 100,000 bales from last month’s estimates to 3.9 million. The decrease is solely a result of lower domestic consumption. Globally, ending stocks are projected at 62.32 million bales versus 60.77 in last month’s report. Production was increased in Brazil and Pakistan but lowered Australia and collectively increased by 300,000 bales. Consumption was lowered by noticeable amounts in Brazil and China and marginally in a few other countries totaling a drop of about 1 million bales.

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John M. Riley, Extension Economist
By John M. Riley, Extension Economist March 10, 2012 16:47
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