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No Surprises In USDA Report

posted on March 12, 2004

Hello, I'm Mark Pearson.

Economic reports issued by the government generally can be regarded as little more than snapshots of current conditions, or perhaps indicators of what's to come. That's why interpretation of economic data can be so dicey.

Take job growth, for example. Since March of 2001, the labor market has lost more than 2.3 million jobs, despite signs from nearly every sector that the economy is improving. That, in turn, has led to uncertainty in the equities markets.

The story is different in the commodity markets, where the basic economic factors of supply and demand rule the day.


No Surprises In USDA Report

Traders on the floor of the Chicago Board of Trade called the March USDA supply and demand report neutral across the board, allowing the grain complex to push to the downside.

By mid-week, initial calls were for soybeans to open at 3-to-5 cents a bushel lower, corn 2-to-4 cents down, and wheat 1-to-2 cents lower.

U.S. soybean ending stocks were unchanged, as expected, at 125 (M) bushels. At least one analyst said if there were any surprises in the report, it was that the government kept Argentina's soybean production unchanged ... and only lowered the Brazil harvest 1.5 (M) metric tons -- to 59.5 (M) million metric tons ... still a record high.

World soybean carryover estimates were 35.88 (M) million tons, down just over 2 (M) million tons from the February report.

In wheat, total ending stocks were raised to 544 (M) million bushels, up 10 (M) bushels from the previous report. However, the wheat export forecast was left unchanged at 1.15 (B) billion bushels. World wheat carryover was cut to just under 125 (M) million tons, down two (M) million tons from the February report.

For corn, U.S. carryover was held steady at 901 (M) million bushels. The USDA left unchanged, production estimates for Argentina, at 12.5 (M) million metric tons ... and China, at 114 (M) million. World carryover was raised just slightly, to 67.8 (M) million tons.


Tags: agriculture government news USDA