WASDE: Wheat stocks larger than expected

The estimate of the worldwide wheat stock for the 2018/2019 season has been increased from 266,7 million tons to 268,1 million tons. In contrast, trade took into account 266,8 million tons. Also increased the USDA (the United States Department of Agriculture) estimates US wheat stocks as of May 2019 to 26,5 million tons, up from 25,83 million tons.

This while traders were taking into account a stock of 26 million tons. The stock increase is mainly due to the fact that exports, despite an improvement at the end of November, are still very much below par.

The combination of this bearish news was exacerbated by an increase in Russian wheat export estimates from 35 million tons to 36,5 million tons. In addition, the SovEcon (a group of influential analysts) has said that Russia's export rate is slowing.

Greater maize stocks
The report also increased the estimate for US corn stocks. This was due to a disappointing consumption figure for the production of ethanol. Global maize stocks were increased to 308,8 million tons, from 307,5 million tons previously. This while trade was counting on a stock of 307,6 million.

The expectation for the Brazilian maize harvest is extra 'bearish' news, because it would amount to 94,5 million tons. That is considerably more than the 80,8 million tons of earlier this year. The USDA estimates the Argentine harvest at 42,5 million tons, where it was previously 32 million tons. Despite this news, the listing on the CBoT is still only slightly.

New hope for export
Global soybean stocks were also increased; from 112,1 million tons to 115,3 million tons. This while traders took into account a stock of 112,8 million tons. In addition, the Brazilian harvest is estimated at 122 million tons and the Argentine harvest is likely to be 55,5 million tons. Nevertheless, the soybean quotation showed an increase, partly due to hopes for export to China.