USDA Raises Corn Crop Estimate, Lowers Wheat and Cotton!
The August crop report has something for everyone, with the USDA raising U.S. Corn production due to a sharp increase in yield estimates. However, difficult weather conditions forced the all Wheat production estimate down by over 20 million bushels from July’s figure. The following are key highlights from this morning’s report:
Corn: The USDA raised the U.S. Corn production estimate to 13.054 billion bushels, up from 12.840 billion bushels in July and above pre-report estimates. Average Corn yields are expected at 152.8 bushels per acre, up from 150.3 in July. 2007-08 Corn carryout is expected to increase to 1.516 billion bushels, slightly above the 1.502 billion estimate for July.
Soybeans: The 2.625 billion bushel estimate for July remains unchanged for August, though average analyst estimates were calling for a moderate increase to 2.653 billion bushels. Average yields also remained in place at 41.5 bushels per acre. Carryout totals were lowered to 220 million bushels, down 25 million bushels from July and 27 million bushels below analyst estimates.
Wheat: All Wheat production is expected to decline to 2.114 billion bushels, down from 2.138 billion in July and 15 million bushels below pre-report estimates. Increased world demand is expected to increase U.S. exports, with 2007-08 carryout totals expected to drop to 404 million bushels, down form 418 million bushels in July.
Cotton: The USDA lowered U.S. Cotton production estimates to 17.346 million bales, down from 17.50 million bales in July and well below the 17.70 average pre-report estimates. U.S. Cotton carryout is expected to fall to 5.80 million, down from 5.90 million in July.
Early calls by CBOT traders are for Soybeans to open up 3 to 5 cents higher, Wheat to open up 2 to 3 cents higher, and Corn to open 1 to 3 cents lower. In early trade, December Cotton is trading at 6225, down 17.
Mike Zarembski, Senior Commodity Analyst
