Tom Leffler Says Latest USDA Report A Mixed Bag

Surprising is one word to describe the latest crop production estimate from the US Department of Agriculture Tuesday. In an interview with the Radio Oklahoma Network's Leslie Smith, Tom Leffler of Leffler Commodities said the report had several surprises for corn, soybeans and wheat.

USDA projected a record 14.032 billion bushel corn crop, which was less than what traders were anticipating. Leffler said that estimate was higher than the July estimate by only 172 million bushels. With the projected yield increased 2.1 bushels per acre to 167.4. Leffler said the nation's ending stocks was increased by 7 million bushels to 1.808 billion bushels. Leffler said the numbers were aided by an increase in usage, which helped offset the production increase.

The production and yield for the nation's soybeans were increased, but not as much as expected according to Leffler. USDA increased production by 16 million bushels over July with an estimated production of 3.816 billion bushels. USDA estimated the nation's soybean yield at 45.4 bushels per acre, a slight adjustment over the July estimate. Leffler said USDA did not change any of the usage for soybeans in terms of crushed or exports and that allowed soybean ending stocks to increase by 15 million over July with total 2014 - 2015 ending stocks estimated at 430 million bushels.

"This was 16 million more than what the trade was looking for, so that was bearish side for the soybeans," Leffler said.

The estimates for wheat also brought some surprises. Leffler said going into the report the trade guessed the biggest increase in wheat production would come spring wheat but USDA only increased production by seven million bushels over last month. Instead it was hard winter wheat that made the big increase 26 million bushels over July. All wheat production increased 38 million bushels over the July estimate.

"We also saw the exports increase by 25 million and feed residual usage increase by 10 million that did help with the increase in production and it did allow only a three million bushel increase into ending stocks for wheat at 663 million," Leffler said.