Potential Market Movers in Tuesday’s Acreage, Grain Stocks Reports
The next mark-moving round of USDA reports will be here on Tuesday, June 30. USDA will release its annual Acreage and quarterly Grain Stocks reports on Tuesday, June 30 at 11 a.m. CDT.
“The acreage numbers are typically the big headline items in the June 30 report,” says Joe Vaclavik, founder and president of Standard Grain. “Still, we’ve seen the quarterly stocks numbers surprise the trade frequently. Either set of numbers has the potential to be a market mover.”
To recap, USDA released the following 2020 acreage estimates in its March Prospective Plantings report:
- Corn: 97 million acres
- Soybeans: 83.5 million acres
- All Wheat: 44.7 million acres
- Cotton: 13.7 million acres
“We got off to a quick start in planting corn,” says Ted Seifried, chief ag market strategist with Zaner Ag Hedge. “Generally, when we do that, we get close to or sometimes beat that intentions number. I don’t know if that will be the case this year.”
Seifried expects to see corn acres drop to 94.5 million and soybean acres increase to about 84.5 million. A drop in corn acres would be a positive for the markets, he says.
“If we see a Grain Stocks number that shows a mountain of corn and we have a tremendous amount of corn planted, it could be a wet blanket on the market,” Seifried says.
USDA increases corn acres from March to June more often than not, Vaclavik notes.
“While I don’t believe an increase is coming, corn acreage could be larger than what many traders believe,” he says.
“There are a lot of unknowns in this report,” adds Mike Lung, a broker with Allendale Inc. “Hopefully this the one that gives us some market direction.”
Allendale expects the following numbers for Tuesday’s reports:
Acreage:
- Corn acres to drop by 1.672 million to 95.318 million
- Soybean acres to increase by 1.244 million to 84.754 million
- Wheat acres to increase 364,000 to 45.019 million.
Grain Stocks
- Corn stocks at 4.849 billion bushels versus last year's 5.202 billion bushels
- Soybean stocks at 1.403 billion bushels versus last year's 1.783 billion bushels
- Wheat stocks at 984 million bushels (final stocks) versus 978 million bushels from USDA on May 12, 2020.
The Biggest Story in Grains
This report will provide some key information on both the size of the 2019 and 2020 corn and soybean crops. But Vaclavik says farmers should keep their eyes on another key market mover.
“The loss of demand for corn via the ethanol industry is the biggest story this year,” he says. “I don’t believe anything could top the ethanol story between now and the end of 2020.”
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