Grain prices in the United States have risen following the publication of the WASDE report. The United States Department of Agriculture (USDA) released this monthly report on the global grain market on Thursday, September 12.
Of all crops, the soy price in particular has risen sharply. That quotation rose by $12 per ton on Thursday, September 10, causing the CBoT in Chicago to touch $324 per ton. This increase was partly because the yield estimate for the harvest in the United States was clearly lower than previously expected. Instead of more than 100 million tons, the expectation has fallen by 1,2 million tons, bringing production slightly below the 100 million ton limit.
China buys soybeans
However, the main reason for the strong increase is not the WASDE report, but the fact that China has purchased approximately 600.000 tons of soybeans from the United States. The drought in Brazil also plays a major role.
The report also showed that corn yields in the United States are estimated to be 2,6 million tons lower. Corn production (worldwide) also decreases by 3,4 million tons, bringing it to approximately 1.105 million tons. Corn consumption decreases by 1 million tons, which reduces the ending stock forecast by 1,5 million tons. However, this still means a high ending inventory. Nevertheless, the corn price on the CBoT rose by more than $2 per tonne.
Production reduction in wheat
For wheat, the USDA report was the most 'bearish'. Although expectations for world production have been lowered, expectations for consumption have also been lowered. This means that the world stock of wheat has reached a record level of 286,5 million tons.
Global production has been reduced by 2,6 million tonnes to 765,5 million tonnes. This is mainly due to lower harvest expectations Australia and Kazakhstan. Kazakhstan is the most striking: production in that country drops by 1,5 million tons to 11,5 million tons.