Washington | Reuters — U.S. and world corn supplies are projected to be smaller than expected by the end of the marketing year due to rising export demand, the U.S. Agriculture Department said on Tuesday.
The government also left its outlook for domestic soybean supplies unchanged and lowered U.S. wheat stocks by just one million bushels in its monthly supply and demand report.
Chicago Board of Trade (CBOT) corn futures turned higher and rallied to session highs following the release of the closely watched report. Wheat also turned higher while soybeans sank to session lows.
USDA cut its outlook for domestic end stocks of corn for the 2014-15 crop year by 50 million bushels to 1.777 billion, the low end of a range of analysts’ forecasts. It was the fifth month in a row that the government has lowered its U.S. corn supply view.
“I guess they (investors) like the corn number, and they should, said Jack Scoville, analyst at the Price Futures Group. “Those were clearly the friendliest numbers, and we also need some acres.”
For world corn stocks, USDA reduced its projection for the 2014-15 crop year to 185.28 million tonnes from 189.64 million.
U.S. corn export projections were raised to 1.8 billion bushels from 1.75 billion bushels in February.
Higher corn exports also were forecast from major production countries in South America. USDA pegged Argentine corn exports at 14.5 million tonnes, up one million from its previous view, and Brazilian corn exports at 20.5 million, also one million higher than the February outlook.
USDA raised its Argentine corn harvest forecast to 23.5 million tonnes from 23. It left its Brazilian corn production estimate unchanged, at 75 million tonnes.
For soybeans, USDA pegged domestic end stocks at 385 million bushels. Analysts had been expecting a cut to 376 million, based on the average of estimates in a Reuters poll.
The government raised its global soybean end stocks view to 89.53 million tonnes from 89.26 million. The increase was slightly above the average of market forecasts. It left its estimate of soybean production in both Brazil and Argentina unchanged.
U.S. wheat end stocks were lowered to 691 million bushels from 692 million, below the average analyst estimate. Global wheat stocks were lowered to 197.71 million tonnes from 197.85 million, near market expectations.
— Mark Weinraub is a Chicago-based Reuters correspondent covering grain futures markets. Additional reporting for Reuters by Michael Hirtzer in Chicago.