A quiet month for the June world agricultural supply and demand estimates from USDA? If you ask Chief Economist Seth Meyer, he might concur for a couple of reasons.
“First, we didn’t have a bunch of last-minute policy changes we had to incorporate in the WASDE. No firm information yet on any new changes. Also, by the time we went into lockup, no renewable fuel standard had dropped yet. That’s likely to be something we’ll have to incorporate into the next WASDE.”
And even with this month’s crop production report featuring a winter wheat production forecast at that crops largest since 2016 incorporated into the domestic balance sheet…
“Even there, right in line with expectations and unchanged from last month.”
Yet, if there is one area that was notable from USDA June reports ongoing rains in southern crop growing regions that hampered planting and led to changes in harvest acreage projections.
“We don’t normally make acreage changes, but we did make some acreage changes, this time in a couple crops. The first thing to note is we added net acreage change of a loss of 70,000 acres in rice. We added 30,000 acres of rice in California, but reduced acreage in the delta by 100,000 acres, as the really excessive rainfall, excessive moisture, we think has delayed planting there. (In addition,) we made a reduction in cotton acres because of that same heavy moisture in the Delta.”
The chief economist adds that the situation of planting delays, and what that means regarding data and trends within future USDA reports is worth observing.
“We’ll see how those acreage changes play out. So here in the June report, we don’t normally make these changes, we’ll get acreage and we’ll see how that actually turns out here at the end of the month.”