Today’s reported yield reductions were in line with what the market anticipated. However, USDA’s 2020/21 corn ending stocks forecast was about 40 million bushels above industry expectations ahead of WASDE, while its 2020/21 soybean ending stocks forecast was around 9 million bushels below expectations.
The modest discrepancies in ending stocks vs. average expectations was based on changes in use from the August report. More specifically, total domestic 2020/21 corn use fell by 200 million bushels on lower ethanol and feed demand. So, even with rising export demand and production falling some 378 million bushels, ending stocks fell just 253 million bushels to about 2.5 billion bushels in 2020/21.
For soybeans, 2020/21 ending stocks fell to 460 million bushels, down 150 million bushels from the August estimate. New-crop soybean production was pegged at just over 4.3 billion bushels and domestic use remained steady, falling just 3 million bushels. However, use in 2019/20 was raised 40 million bushels, which contributed to ending stocks dipping lower than pre-WASDE speculation.