Last week the USDA released its latest World Agricultural Supply and Demand Estimates report, forecasting a decline in corn production by 40 million bushels from the August forecast.
On the flip side, the report put soybean yields up by about 1.5 bushels per acre, and raised soybean crush by 10 million bushels.
Wheat projections, however, didn't change from last month.
Neil Townsend, director of market research for CWB — which is becoming G3 Canada Ltd., says wheat prices have been beaten down recently, and this report will limit the ability for prices to go up again because it shows the world wheat supply is so big.
"So the world wheat crop is now estimated at a record — all-time record — 731 million tonnes, and that has also pushed stocks up to a very large amount of 226 million tonnes," he says. "This kind of highlights the fact supply is running well ahead of demand, and until we see more demand emerge, the supply is going to be a problem, which is going to put a cap on where prices can go."
Source : PortageOnline