The season-average corn price received by producers is forecast down 40 cents to $4.40 per bushel.
Hultman said Thursday’s estimates for corn production were a little less than he expected.
“But there is plenty of time for those estimates to change. USDA’s estimate of 2.532 billion bushels of ending stocks, if true, would be the most since the 1987-88 season and would likely put corn prices below USDA’s average farm price estimate of $4.40 a bushel.”
SOYBEANS
USDA’s outlook for soybeans calls for higher supplies, use and ending stocks, a recipe for lower prices.
Supplies are forecast to climb 8% above 2023-24 with increased beginning stocks and production. USDA anticipates farmers will produce 4.5 bb, up 8% year-over-year, assuming a weather-adjusted trend yield of 52 bpa and a 4.2 million acre increase in harvested area from 2023-24.
As U.S. crush capacity expands, USDA sees domestic crush climbing to a record 2.4 bb. “Reduced soybean meal prices will likely make soybean meal a more competitive feed ingredient and may prompt stronger demand in the global livestock and poultry sectors after several years of high prices,” the report notes. Soybean meal exports are also forecast to set new records.
Renewable diesel will continue to drive soybean oil demand, with soybean oil for biofuel expected to grow by 8% to 14 billion pounds.
Soybean exports are also forecast to climb in 2024-25 by 155 mb to 1.875 bb.
“Large global supplies are likely to lead to lower soybean prices, spurring international demand, but the U.S. share of exports is expected to remain below 30 percent of global exports (compared to near 40 percent during 2013/14 to 2017/18) due to higher South American supplies,” the report states.
Ending stocks for 2024-25 are projected at 435 mb, up 120 mb from the 2023-24 season. That would put the ending stocks-to-use ratio at nearly 10%, the highest since 2019-20. The season-average farm price is projected at $11.20 per bushel, down $1.45 from 2023-24.
“The early estimate is a reasonable start for a season we don’t know much about, but the estimate will be challenged this spring,” DTN’s Hultman said. “It remains to be seen if farmers will increase soybean plantings from 83.6 million in 2023 to 87.5 million acres of soybeans without much incentive.”
WHEAT
USDA sees increased supplies, larger total use and higher ending stocks of wheat in 2024-25.
Wheat production is expected to be 5% above 2023-24 at 1.9 bb and would be the highest in five years.
The NASS Winter Wheat and Canola Seedings report estimated winter wheat plantings at 34.4 million acres. Combined spring and durum wheat acres are forecast to be slightly lower than last year as soybeans, minor oilseeds and other crops appear to be more profitable for growers in the Northern Plains. Overall wheat planted area is forecast at 47 million acres, with 38.4 million acres likely to be harvested. The average yield is estimated to climb 2% to 49.5 bushels per acre.
After six years of declining beginning stocks, USDA sees supplies beginning the year at 658 million bushels. Combined with a larger crop, total supplies are forecast at 2.678 billion bushels.
Total use is forecast at 1.909 bb, up 2% from 2023-24 but still below the five-year average. USDA says domestic use will be moderately lower, as cheaper and abundant corn takes up a larger share of feed rations. Food use is projected at 962 million bushels, while exports are expected to rebound from last year’s 52-year low to 775 mb.
Ending stocks are raised to 769 million bushels, 17% higher than 2023-24, with a stocks-to-use ratio of 40.3%. The season-average farm price is forecast at $6 per bushel, down $1.20 from 2023-24.
“The resulting average farm price of $6.00 for 2024-25 reflects the current state of depressed wheat prices worldwide and this report reinforces another tough year ahead for wheat growers,” Hultman said. “Given the improved soil moisture we have seen over winter, there is room for a little higher yield than USDA expects.”
Katie Dehlinger can be reached at katie.dehlinger@dtn.com
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