Rice
Rice futures continue to be pressured by abundant global supplies and relatively soft demand. In the December WASDE, the total U.S. supply and domestic use estimates were unchanged. Imports were reduced by 1 million/cwt, but that was offset by a 2 million/cwt reduction in rough rice exports, resulting in a 1 million/cwt increase in ending stocks. The projected average on-farm price for all rice was lowered by $1.10 to $11.60/cwt, and the projected long-grain on-farm price was lowered by $1/cwt and is now pegged at $10.50/cwt. We could still see that number move lower, as January futures have traded as low as $9.83 in recent days.

Cotton
March cotton futures look to have bottomed for the time being, building on support at the contract low of 63.11 cents. The market needs to close above resistance at 65 cents to begin to build any upside momentum, though. The monthly WASDE increased the production estimate by 1% to 14.3 million bales on higher yields across the Southeast and delta. Mill use was reduced by 100,000 to 1.6 million bales, the lowest in nearly 150 years. Ending stocks are now projected at 4.5 million bales, which is a stocks-to-use ratio of 32.6%.  The projected season average on-farm price was reduced to 60 cents/lb. 

Corn
This month’s WASDE report surprised the market by cutting U.S. corn ending stocks 125 million bushels to 2.029 billion, about 95 million below expectations. Exports were raised another 125 million to a record 3.2 billion, while ethanol and feed demand were unchanged. Global stocks were trimmed just over 2 mmt to 279.2 mmt. South American estimates held steady; Ukraine was lowered 3 mmt and the EU raised 1 mmt. Market reaction to the bullish news was positive but gains were capped by continued weakness in soybean, wheat and crude oil futures. The most active contract, March, needs to close back above $4.50 to build more upward momentum. 

Soybean
U.S. soybeans figures were largely uneventful as ending stocks were unchanged at 290 million bushels, nearly matching expectations and marking the fifth straight December WASDE with no revisions. Global stocks inched 0.4 mmt higher to 122.4 mmt. USDA made no adjustments to South American production or Chinese import projections. Soybean futures slid after the report and are now considered significantly oversold on short-term momentum indicators but show no signs of bottoming yet. The market may be due for some type of correction, but it is likely to be short-lived. 

Wheat
U.S. wheat ending stocks stayed at 901 million bushels, slightly above expectations. Hard red spring stocks were raised 5 million bushels while white wheat stocks were lowered by 5 million. Globally, production rose 9 mmt to 837.8 mmt, with increases across multiple exporters, pushing world stocks 3.5 mmt higher to 274.9 mmt. Prices settled slightly lower on most contracts following the report. 

Livestock and Poultry
In the monthly WASDE, USDA raised the forecast for 2025 beef and poultry production and lowered the pork production estimate. For 2026, beef production estimates were increased due to higher cattle weights, and the broiler production estimate was also raised based upon recent production data. The pork production estimate for 2026 was unchanged, but The Quarterly Hogs and Pigs report, to be released later this month, will provide estimates on the pig crop and farrowing intentions. Cattle price estimates were lowered for both 2025 and 2026 based on recent data and reduced slaughter capacity expected in 2026. Hog prices are also expected to be lower based on recent prices.