By MICHELE F. MIHALJEVICH
WASHINGTON, D.C. — USDA’s most recent estimate of soybean and corn stocks should provide for intriguing discussions as farmers plan for 2018, according to DTN’s senior analyst.
Stocks of old-crop soybeans totaled 301 million bushels as of Sept. 1, the agency’s National Agricultural Statistics Service (NASS) said in its quarterly Grain Stocks report. The stocks were up 53 percent from 197 million bushels at the same time last year. The June-August disappearance of 665 million bushels was a drop of 2 percent from 2016.
The report was released Sept. 29.
Those 301 million bushels represent the highest Sept. 1 soybean stocks in 10 years, said DTN’s Darin Newsom. Since the 2013/14 crop year, soybean stocks have increased annually.
“This is despite the fact that global demand continues to go up,” he noted. “Does that change the possible acreage debate for 2018? If we have 301 million bushels and if we do see the type of production that everyone is talking about right now for 2017, what’s that do to the 2018 acreage debate? I think it’s going to be interesting; I think it’s going to be another interesting winter.”
Global demand does continue to increase and Newsom said he doesn’t see that demand changing anytime soon.
The soybean stocks number was lower than both the average pre-report trade estimate of 338 million bushels and USDA’s previous projection of 345 million, said Rich Nelson, chief strategist for Allendale, Inc.
“With this surprise, (USDA will) make this change in their October report by adjusting feed and residual,” he explained. “Because known demand (for soybeans) is 97 percent of all demand, and crush and exports have solid data, this means they have to go back and revise the previous year’s production.”
In the Grain Stocks report, soybean production for 2016 was revised to 4.3 billion bushels, a drop of 10.6 million bushels from earlier estimates. Planted acres, at 83.4 million, were unchanged, while harvested acreage dropped 40,000 acres to 82.7 million. Yield was 52 bushels per acre, a slight drop of 0.1 bushel.
For old-crop corn, NASS said stocks were 2.29 billion bushels, up 32 percent from 1.7 billion at the same time last year. The June-August disappearance was 2.93 billion bushels, down from 2.97 billion a year ago.
The corn number was the highest Sept. 1 stocks figure in 30 years, Newsom said. “To me, this is a danger sign, this is a red flag,” he explained. “I think this is going to be a major point of discussion heading into the 2018 planting season. How much more are we willing to plant? How many more years are we willing to continue to produce this amount of corn?”
All wheat stocks totaled 2.25 billion bushels, down 11 percent from last year’s 2.5 billion, NASS said. The June-August disappearance was 668 million bushels, down 10 percent from a year ago.
First-quarter demand for wheat wasn’t anything extraordinary, Newsom said. “We needed to see something, maybe not extraordinary, but we needed to see some pretty solid first-quarter demand and it just didn’t happen. Wheat is still going to be struggling with an oversupply situation.”
In the NASS Small Grains summary, the agency said all wheat production for 2017 was 1.74 billion bushels, a 25 percent decline from the revised 2016 figure of 2.31 billion. The area harvested for grain was 37.6 million acres, a drop of 14 percent.
Yield was estimated to be 46.3 bushels per acre, down 6.4 bushels from last year. Winter wheat production was 1.27 billion bushels, a 24 percent decrease from 2016.
According to NASS, Illinois had 381 million bushels of corn as of Sept. 1, up from 216 million at the same time a year ago; Indiana, 133 million, up from 99 million; Iowa, 504 million, up from 419 million; Kentucky, 11 million, up from 6 million; Michigan, 49 million, up from 39 million; and Ohio, 65 million, down from 67 million.
Information on Tennessee stocks was withheld to avoid disclosing data for individual operations, NASS reported.
For soybeans, Illinois had 39 million bushels, up from 28 million; Indiana, 21 million, up from 12 million; Iowa, 53 million, up from 37 million; Michigan, 7 million, up from 6 million; and Ohio, 20 million, up from 14 million. Figures on Kentucky’s soybean and wheat stocks, along with Iowa’s wheat numbers, were also withheld.
All wheat stocks in Illinois totaled 50 million bushels, up from 45 million; Indiana, 39 million, down from 41 million; Michigan, 53 million, down from 54 million; and Ohio, 80 million, up from 76 million.