CBOT Weekly: ‘Not looking for any fireworks’ in June WASDE
Report unlikely to have notable changes
| 2 min read
The Chicago Board of Trade building on May 28, 2018. (Harmantasdc/iStock Editorial/Getty Images)
Glacier FarmMedia | MarketsFarm — Do not expect any major changes in the June supply and demand report from the United States Department of Agriculture, said Terry Reilly, senior agricultural specialist for Marex.
“I’m not looking for any fireworks,” said Reilly.
He suggested the USDA might trim its corn stocks in the report out June 12, make a few if any changes to its soybean estimates, and maybe tweak its trade data for wheat.
“Other than that, I think the focus will be on South American production,” Reilly said.
However, if there are significant changes to the June report, Reilly said those would most likely be the USDA increasing its call on domestic soybean exports and the department cutting its estimate on U.S. wheat production.
Ahead of the June WASDE, reports placed the average trade guess for U.S. corn ending stocks at 1.39 billion bushels for 2024/25 and 1.79 billion for 2025/26. That’s compared to the USDA’s May estimates of 1.42 billion and 1.80 billion bushels, respectively.
The trade has also been looking for minor changes to U.S. soybean carryovers, with that for 2024/25 to bump up one million bushels at 351 million. The 2025/26 carry is expected to rise three million bushels at 298 million.
It’s much the same story for old crop U.S. wheat, with ending stocks projected to tack on one million bushels at 842 million. However, new crop wheat is to rise 19 million bushels at 942 million.
As for South America, corn production in Argentina is to dip to 49.94 million tonnes while that for Brazil is to rise to 131.68 million. Soybean output in Argentina is to hold relatively firm at 49.04 million tonnes and Brazil to inch up to 169.27 million.
Once the June WASDE has passed, Reilly believes the trade will shift into a weather market, likely lasting to the end of July. He said by that time the Trump administration will finally have made its decisions on U.S. biofuel policy.
The White House has remained largely silent on which direction it plans to take in regard to biofuel tax credits. Market speculation has run the gamut from no changes to canceling the tax credits.
