USDA 2017-18 Forecast Released
Soybeans - The 2017-18 outlook for U.S. soybeans is for higher supplies, crush, exports and ending stocks. The soybean crop is projected at 4,255 million bushels, down 52 million from last year’s record crop with a forecast lower trend yield more than offsetting a higher harvested area. While soybean demand continues to strengthen, growth is not enough to consume the near-record crop forecast for 2017-18. U.S. ending stocks for 2017-18 are projected at 480 million bushels, up 45 million from the 2016-17 forecast. Soybean production is projected down 3.4 million tons to 344.7 million, mainly on declines from last year’s records for the United States, Brazil and Paraguay as yields return to trend levels. This slight decline is forecast to reduce global stocks slightly from 2016-17’s record levels. While global supplies are forecast lower, we are still almost six months from Brazil planting its first beans and a year before Argentina finishes its harvest. A lot can happen in this time. For now, the market is concerned about how many acres of soybeans the U.S. plants, and guessing how large the yield will be. This uncertainty continues to keep a lid on soybean prices. While new crop soybeans continue to hold support near $9.50, there remain a lot of reasons to be bearish toward soybeans without some significant growth in demand.
Rice - U.S. 2017-18 all rice production is forecast at 201 million cwt, down 23.1 million from the previous year, all on a large reduction in long-grain acreage as indicated by the NASS Prospective Plantings survey issued March 31. The forecast 2017-18 yields are based on long-term historical trends and are higher for long grain but slightly lower for combined medium and short grain. Total 2017-18 rice supplies are forecast to decrease 7 percent from the previous year to 273.1 million cwt, primarily on the reduction in long grain. While overall demand is forecast down 4 percent from 2016-17, tighter supplies are forecast to lead to a reduction in stocks. Long-grain stocks are projected at 20.7 million cwt, down 8 million from 2016-17, while combined medium- and short-grain are projected 2 million cwt lower at 14.6 million. Total 2017-18 global supplies are at 599.9 million tons, up 2.6 million from 2016-17, based on larger carry-in stocks. Sharp reductions in rice acres in 2017 are forecast to reduce U.S. rice stocks 20.8 percent year over year. This reduction is forecast to help support rice prices as the USDA forecast the 2017-18 all rice season-average farm price between $10.70 and $11.70/cwt. This is up $0.80 from the projected 2016-17 price.
Corn - The corn crop is projected at 14.1 billion bushels, down from last year’s record high with a lower forecast area and yield. The yield projection of 170.7 bushels per acre is based on a weather-adjusted trend assuming normal planting progress and summer weather, estimated using the 1988-2016 time period. Total U.S. corn use in 2017-18 is forecast to decline 2 percent from a year ago as a slight increase in domestic use is more than offset by lower exports. With total supply falling faster than use, 2017-18 U.S. ending stocks of corn are down 185 million bushels to 2.11 billion bushels. The global coarse grain outlook for 2017-18 is for lower production, increased use and sharply reduced ending stocks. While global supplies are tightening, U.S. carry-over of more than 2 billion bushels will remain a drag on prices. For corn prices to increase, the market will need to see supplies tighten further or improved demand (particularly export demand) before corn prices see any significant gains.
Cotton - A projected 2017-18 U.S. cotton crop of 19.2 million bales is expected to sharply increase next season’s ending stocks. Production is anticipated to rise 12 percent from 2016-17, based on 12.2 million planted acres as indicated in Prospective Plantings, combined with below-average abandonment (due to relatively favorable moisture) and average yields. Domestic mill use is projected higher at 3.4 million bales, while exports are expected to fall to 14 million, as competitors’ supplies grow. Ending stocks are projected at 5 million bales, or 29 percent of total use.
Borer in three new counties
Garland, Montgomery and Pike counties have been added to confirmed sites of the emerald ash borer in Arkansas. This insect is confirmed in the following 17 counties: Bradley, Calhoun, Clark, Cleveland, Columbia, Dallas, Garland, Hempstead, Hot Spring, Lafayette, Montgomery, Nevada, Ouachita, Pike, Randolph, Saline and Union. Garland, Montgomery and Pike counties are already inside currently quarantined areas as buffer counties. This change in total confirmed sites of the borer will not affect the size of the current quarantined area at this time. More information on the 33-county Arkansas area affected by the emerald ash borer quarantine can be found at aad.arkansas.gov/quarantines or phoning 501-225-1598.