Quarterly Grain Stocks Report Projections

Quarterly Grain Stocks Report Projections
Todd Hubbs, Agricultural Economist - University of Illinois

When the government reopens USDA will update the Grain Stocks report. Todd Gleason explains how this assessment of usage plays into the price of corn and soybeans.

1:58 radio
2:01 radio self-contained

The Grain Stocks report is tallied four times per year. For corn and soybeans these are December 1st, March 1st, June 1st, and September 1st. They’re done in this order and correspond to the beginning and the end of the year supplies. The reports always read “As of”. So, for instance, the Grain Stocks report that was supposed to come out this Friday would read as of December 1st. The report, as USDA sees it, is nearly a survey. The agency contacts about 9000 grain elevators, and other storage facilities across the United States to see how many bushels of corn and soybeans are on hand on and off the farm. Then they pretty much make a very well educated guess as to how much has been fed to livestock and add that to the other consumption numbers. Bushels crushed or ground either for soybean meal and oil or for ethanol and bushels exported. When the two are added together, bushels left plus bushels consumed, it is supposed to equal the total number of bushels the United States had on hand when the marketing year started. Todd Hubbs from the University of Illinois picks up that line of thought for corn.

Hubbs :35 …that could be supportive to corn prices as well.

Quote Summary - If we assume USDA’s projection is correct and we do hit 2.33 billion bushels of use for feed and residual use in the first quarter, I’ve calculated a total supply of 16.77 billion bushels. When you take into account the other uses, which we have readily available with some error, I see December 1st stocks at about 12.1 billion bushels with the current production. If we see actual corn production fall, then the stocks to use could move even lower. So, that could be supportive to corn prices as well.

Supportive, but not until the numbers are released. Those were scheduled for this Friday. USDA says it won’t update the grain stocks report until after the government shutdown has ended.