USDA updated its corn production number in Friday’s World Agricultural Supply and Demand Estimates, now estimated at 15.8 billion bushels, down 213 million bushels from last month, while soybean production was raised to a record 4.535 billion bushels. Markets reacted swiftly to the report, and not necessarily as analysts has expected. Rhett Montgomery is Lead Commodities Analyst with DTN.
“I gotta say, I didn’t think the data was in of itself bearish, but looking at the markets here, certainly taking it hard, at least on the soybean market. Last I checked, before logging in here, soybeans were down 35 cents following the news today, corn being dragged lower as a result of that, down about six, and wheat pretty heavily lower as well, about 25 to 30 cents.”
Montgomery says bullish and bearish sometimes is a perspective from where the market is at a given time, given historic August rallies.
“It could be especially on the soybean market. Traders were expecting and had priced in an ending stocks number lower than what we saw today from USDA. I’m not ruling out further cuts down the road, but at least for today, maybe some frustration there that the situation is not being printed as bullishly as it could be by the time it’s all said and done.”