In the May 10 WASDE report, USDA’s 2019/20 forecasts left corn and soybeans in bearish territory, while sugar showed stability. U.S. corn stocks-to-use (STU) ratio was projected at nearly 17 percent, with ending stocks for 2019/20 expected to rise 16 percent compared to 2018/19. This increase could be attributed to domestic production estimates up a hefty 610 million bushels YOY. However, production could be reduced from this initial forecast as rainy weather has been causing notable planting delays for farmers in the Corn Belt.
If farmers feel their corn planting window has closed, they could decide to switch to soybeans, where U.S. new-crop production was gauged at 4.2 billion bushels. However, soybean’s STU ratio is projected at an alarmingly bearish 23 percent, so until the U.S.-China trade dispute is resolved, corn will likely be the more profitable crop.
On a steadier note, USDA predicted 2019/20 U.S. sugar to have a 12.0 percent STU, a slightly bullish figure due in part to low beginning stocks of 1.5 million short tons, raw value, which are forecasted to fall another 1 percent this time next year. USDA expects new-crop beet sugar production to be greater than this year’s, despite planting progress in the upper Midwest being well behind schedule.