USDA pegs U.S. winter wheat seedings at six-year low
U.S. farmers planted the smallest number of acres to winter wheat since 2010, and plantings of one class, hard red winter wheat, were the lowest in at least 30 years, according to government data released on Tuesday.
The U.S. Department of Agriculture estimated U.S. winter wheat seedings for 2016 at 36.609 million acres, down 7.2 percent from 2015. The figure fell more than 2 million acres below the low end of the range of trade estimates.
The USDA estimated seedings of hard red winter wheat, at 26.5 million acres, the lowest in records dating to 1986-87.
"(The) biggest surprise in this report was the winter wheat seedings. If we don't get sharply higher durum and spring wheat seedings this spring, the trade might be looking at an extremely low U.S. all-wheat area for 2016," said Terry Reilly, senior commodity analyst for Futures International.
The data buoyed wheat futures on the Chicago Board of Trade and lifted March K.C. hard red winter wheat futures by about 4 percent, its biggest one-day rise since June.
Also on Tuesday, the USDA said U.S. corn and soybean supplies ballooned to record levels during the last three months of 2015 following bountiful harvests of both commodities and cutbacks in usage.
But corn and soybean production was smaller than previously estimated, the government said.
"The thought was that big crops get bigger and they actually reduced the production for (U.S.) beans and corn and pulled back the yields as well," said Dax Wedemeyer, analyst with U.S. Commodities.
CBOT soybean futures, which were trading lower before the report was released, surged to their highest level since Dec. 7. Corn futures also rallied into positive territory.
U.S. corn stocks as of Dec. 1, 2015, stood at 11.212 billion bushels, slightly above the 11.211 billion a year earlier and the biggest ever on that date in any year. Soybean stocks rose to 2.715 billion bushels from 2.528 billion a year earlier, beating the previous record of 2.701 billion set in December 2006.
The Dec. 1 wheat stocks figure of 1.738 billion bushels was a five-year high that exceeded market expectations by 40 million bushels.
USDA cut its estimate of the U.S. corn harvest for the 2015-16 marketing year to 13.601 billion bushels from 13.654 billion, lowering the average yield per acre to 168.4 bushels from 169.3 bushels. Soybean production was lowered 51 million bushels to 3.930 billion, with the average yield reduced to 48.0 bushels per acre from 48.3 bushels.
Domestic corn ending stocks for 2015-16 were surprisingly raised to 1.802 billion bushels from 1.785 billion bushels despite the smaller harvest view, largely due to a 50 million-bushel cut to exports.
U.S. soybean ending stocks were lowered 25 million bushels to 440 million bushels. The average of analysts' estimates for soybean stocks was 468 million bushels. USDA also cut its forecast for U.S. soy exports to 1.690 billion bushels from 1.715 billion.
U.S. wheat ending stocks were raised 30 million bushels to 941 million, more than analysts had expected, due to a reduction in feed and residual usage.
