Last week’s Grain Stocks report should reduce the ending stocks for both corn and soybeans this month.
USDA’s quarterly grain stocks estimate suggests there are fewer bushels of corn and soybeans left over from last year than have been reported so far. University of Illinois Commodity Grain Markets Specialist Todd Hubbs says corn is off by 56 million bushels and soybeans are down 44 million.
Having said that, Hubbs admits the 2016/17 projected carryouts for corn and soybeans remain very large. It’s possible to roll forward the September grain stocks report to forwarding figure the October USDA Supply & Demand table… or at least some of the adjustment. When you do that, it shows corn carryout at 2.295 billion bushels and soybean ending stocks at 301 million. It is a matter then, says Hubbs, of laying off the heavy supply-side against growing consumption – which for the moment is hampered by low river water levels that have been causing transportation problems to the Gulf of Mexico.
It’s not to say a bullish market is around the corner, but that demand should provide a series of marketing opportunities over the coming months.