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Key insights from upcoming USDA report

Nov 08, 2024
By Farms.com

Minor adjustments expected in corn and soybean stocks
This week, the agricultural sector anticipates the USDA’s November Crop Production Report, which will update the market on the latest corn, soybean, and wheat production figures. While minimal changes are expected for U.S. corn and soybean yields, significant updates are predicted for global wheat stocks.

The corn segment might see a slight production cut ranging from 15 to 25 million bushels, with U.S. ending stocks projected to decrease by about 50 million bushels. Analyst estimates, however, show a broad range of expectations, suggesting some uncertainty in the market.

Soybeans are predicted to hold steady in production compared to last month’s data, totaling 4.557 billion bushels. Nonetheless, a modest drop in ending stocks to 532 million bushels reflects a cautious outlook from market analysts, who estimate stocks could vary significantly.

On the global stage, wheat production is under scrutiny, with potential reductions due to lower crop forecasts from various countries. The USDA might lower its global wheat ending stocks forecast by 0.93 mmt to 256.79 mmt, responding to changing agricultural conditions worldwide.

The domestic harvest for corn and soybeans is wrapping up effectively, with most crops already collected despite recent weather challenges that have slightly delayed finishing the harvest but have been beneficial for other crops.

Further influencing agricultural markets are macroeconomic factors, including the U.S. Federal Reserve’s latest interest rate decision and significant economic policy discussions in China, both of which could sway agricultural economics and global market trends in the coming months.


Trending Video

Wheat Yields in USA and China Threatened by Heat Waves Breaking Enzymes

Video: Wheat Yields in USA and China Threatened by Heat Waves Breaking Enzymes

A new peer reviewed study looks at the generally unrecognized risk of heat waves surpassing the threshold for enzyme damage in wheat.

Most studies that look at crop failure in the main food growing regions (breadbaskets of the planet) look at temperatures and droughts in the historical records to assess present day risk. Since the climate system has changed, these historical based risk analysis studies underestimate the present-day risks.

What this new research study does is generate an ensemble of plausible scenarios for the present climate in terms of temperatures and precipitation, and looks at how many of these plausible scenarios exceed the enzyme-breaking temperature of 32.8 C for wheat, and exceed the high stress yield reducing temperature of 27.8 C for wheat. Also, the study considers the possibility of a compounded failure with heat waves in both regions simultaneously, this greatly reducing global wheat supply and causing severe shortages.

Results show that the likelihood (risk) of wheat crop failure with a one-in-hundred likelihood in 1981 has in today’s climate become increased by 16x in the USA winter wheat crop (to one-in-six) and by 6x in northeast China (to one-in-sixteen).

The risks determined in this new paper are much greater than that obtained in previous work that determines risk by analyzing historical climate patterns.

Clearly, since the climate system is rapidly changing, we cannot assume stationarity and calculate risk probabilities like we did traditionally before.

We are essentially on a new planet, with a new climate regime, and have to understand that everything is different now.