Markets Unfazed by USDA Data Dump - Analyst Brady Sidwell Says 'World Has Plenty of Everything'Fri, 08 Feb 2019 15:02:32 CST
On Friday, the USDA dumped a major set of data relieving some of the department’s backlog of information reporting that was delayed due to the 35-day government shutdown that ended recently. Five reports in total were released, including the latest World Agricultural Supply & Demand Report, three World Market & Trade Reports covering Cotton, Grains and Oilseeds and the World Agriculture Production Report. Upon the release of these reports, Radio Oklahoma Ag Network Farm Director Ron Hays reached out to Brady Sidwell of Sidwell Strategies here in Oklahoma for his reaction on the information published and what insights the data might reveal to the current market. You can listen to their conversation by clicking or tapping the LISTEN BAR below at the bottom of the page.
“I think the headline is that there is plenty of everything. We had a few revisions down, but the market is not really reacting much based on how much information the market did not have,” Sidwell said. “The big numbers that came out here were corn yield numbers that were below even the expectations.”
According to Sidwell, that number came in 2.5 bushels per acre below December estimates and over a bushel lower than the average estimate. The issue here, Sidwell attributes to Brazil and Argentina where they increased their supplies.
“So, despite some reductions in US ending stocks that should have been supportive of the market, we saw global stocks increasing,” Sidwell said, remarking that the same was true for soybeans. “It’s still kind of plenty of everything. Even though US soybean ending stocks were down and world ending stocks were a little bit lower, it was basically right at the market’s expectation. When that happens, markets don’t typically react too much.”
Regarding wheat, this data set essentially confirmed that wheat acres across Oklahoma and Kansas decreased by nearly 700,000 acres compared to a year ago, as farmers continue to look at other cropping options.
The Winter Wheat Seedings in total of 31.29 million acres was the lowest on record since 1909. Top-grower Kansas planted 7.2 million acres, down from 7.7 million last year, down six percent while Oklahoma dropped another 200,000 acres compared to a year ago at 4.2 million seeded this past fall and now in the ground. Texas is flat on year at 4.5 million, surpassing Oklahoma in winter wheat acres by 100,000.
In total, the hard red winter wheat acreage number is called 22.2 million acres for the current crop in the ground, down three percent from a year ago- Besides Oklahoma and Kansas losing wheat acres, Nebraska shows a total of 930,000 acres- down 15% from a year ago and a record low acreage number, according to USDA. Click here to read more about USDA's insights on the wheat industry.
To review these reports released by the USDA, click on the corresponding link, below.
Cotton: World Markets and Trade FAS
Grains: World Markets and Trade FAS
Oilseeds: World Markets and Trade FAS
World Agricultural Production
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