U.S. Crop Report To Shed Light On Production Estimates
Saxo Bank | Sep 11, 2013 10:06AM ET
The US Department of Agriculture will release its monthly World Agriculture Supply Demand Estimates on Thursday at 18:00 CET. Following a dry and hot August, traders expect a downgrade in yield for both corn and soybeans. As weather developments during August tend to have the greatest impact on soybeans considering its later growing cycle compared to corn, the impact will be felt mostly on soybeans.
Soybean ending stocks for the 2013/14 season are estimated to have dropped to between 165 and 170 million bushels which is significantly lower than last month's estimate of 220 million bushels but still well above the 125 million bushels seen at the end of the 2012/13 season which was a nine-year low.
Corn ending stocks are also expected to be down from last month but even at the lower end of the estimate range at 1.732 billion bushels, it will still represent an eight-year high which will go a long way to reduced the tightness that was seen during the 2012-13 season when stocks were down to around 720 million bushels.
The weather developments during August and the impact on the different crops explains the dramatic outperformance of soybeans during this time. But at the same time it leaves little room to the upside as much of this downgrade seems to be fully priced in. That is especially so considering we have seen the speculative net-long position rise strongly during August to the highest level since last November.
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.