Agricultural News
Rich Nelson of Allendale on December WASDE- Not Much to Discuss
Thu, 09 Dec 2021 13:28:16 CST
The November WASDE report from the USDA featured minor adjustments to the grains and oilseeds as well as to cotton. After the reports were released on Thursday midday- Radio Oklahoma Ag Network Senior Farm/Ranch Broadcaster Ron Hays talked with Rich Nelson of Allendale and he said "as far as corn and soybeans go- not too much to discuss." He did say there were more numbers being adjusted internationally by USDA compared to the domestic stocks stats.
Hays and Nelson talked about the report, as well as the political issues swirling around the Winter Olymics in China and how they might impact US Ag Exports to the Asian giant. And- they talked about what might lie ahead in the competition over 2022 acres in the coming weeks and months- with the wild card now being the price of fertilizer. Listen to their conversation by clicking on the Listen Bar at the bottom of this story.
According to the summary provided by USDA- This month's 2021/22 U.S. corn supply and use outlook is unchanged from last month. The projected season-average farm price remains at $5.45 per bushel.
Global coarse grain production for 2021/22 is forecast 2.7 million tons higher to 1,501.7 million. The foreign coarse grain outlook is for greater production, increased trade, and larger ending stocks relative to last month. Foreign corn production is forecast higher as WASDE-619-2 increases for the EU and Ukraine more than offset a reduction for China. EU corn production is raised reflecting increases for France, Romania, and Poland. Ukraine corn production is higher based on harvest results to date.
China corn production is reduced reflecting the latest information published by the National Bureau of Statistics which indicated higher area that was more than offset by a reduction in yield. Barley production is raised for Australia but lowered for the EU and Iran. Sorghum production is increased for Australia. Corn exports are raised for Ukraine and the EU. Imports are raised for Iran, Egypt, Saudi Arabia, and the United Kingdom, but lowered for Israel. For 2020/21, corn exports for Brazil are raised for the local marketing year beginning March 2021, based on higher-thanexpected shipments through the month of November.
Sorghum exports for 2021/22 are raised for Australia, with higher imports projected for China. Foreign corn ending stocks are raised, mostly reflecting increases for Ukraine, the EU, Mexico, and Iran that are partly offset by a reduction for China.
As for soybeans and other oilseeds-Total U.S. oilseed production for 2021/22 is forecast at 130.3 million tons, up slightly due to an increase for cottonseed. Soybean supply and use projections for 2021/22 are unchanged from last month. Although soybean crush is unchanged, soybean oil production is raised on a higher extraction rate. With increased soybean oil supplies, food, feed, and other industrial use of soybean oil is raised, offsetting lower consumption of canola and cottonseed oils. Based on a review of EPA's proposed rule for 2020-2022 renewable fuel obligation targets, soybean oil used for biofuel for 2021/22 is unchanged at 11 billion pounds. The U.S. season-average soybean and soybean oil price forecasts for 2021/22 are unchanged at $12.10 per bushel and 65.0 cents per pound, respectively. The soybean meal price forecast is increased $5.00 to $330.00 per short ton. The 2021/22 global oilseed supply and demand forecasts include lower production and lower ending stocks compared to last month. Global oilseed production is projected at 627.6 million tons, down 0.4 million from last month mainly driven by lower soybean production reported by China's National Bureau of Statistics. China's soybean production is down 2.6 million tons to 16.4 million on lower area. Largely offsetting China's reduction is higher sunflower and soybean output for Russia and Ukraine based on harvest results.
For wheat- The outlook for 2021/22 U.S. wheat this month is for slightly lower supplies, unchanged domestic use, reduced exports, and higher ending stocks. Supplies are lowered, on decreased imports with a weaker-than-expected pace for Hard Red Spring (HRS). Exports are lowered 20 million bushels to 840 million on slowing export sales and shipments with equivalent reductions for Hard Red Winter and HRS. Additionally, U.S. export prices are expected to remain elevated the rest of 2021/22, further diminishing U.S. competitiveness. Projected 2021/22 ending stocks are raised 15 million bushels to 598 million but are still 29 percent lower than last year. The projected season-average farm price (SAFP) is raised $0.15 per bushel to $7.05 on NASS prices reported to date and expectations for cash and futures prices for the remainder of 2021/22. This would be the highest SAFP since 2012/13.
The global wheat outlook for 2021/22 is for higher supplies, greater consumption, increased trade, and higher ending stocks. Supplies are projected rising by 4.3 million tons to 1,067.5 million, primarily on the combination of increased beginning stocks for Australia and the EU and upward production revisions for Australia, Russia, and Canada. Australia's production is raised 2.5 million tons to a record 34.0 million, based mainly on the latest Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) forecast. Russia's production is increased 1.0 million tons to 75.5 million, all for winter wheat on updated Ministry of Agriculture data. Canada's production is raised 0.7 million tons to 21.7 million on the latest Statistics Canada forecast. Despite the increases for Russia and Canada, their respective production levels remain significantly below last year. Projected 2021/22 world consumption is raised 1.9 million tons to 789.4 million on higher feed and residual use more than offsetting lower food, seed, and industrial use. Most of the feed and residual use increases are for Australia and Russia on higher production and for the EU, as more wheat feeding is expected with extended rains affecting grain quality at harvest.
Projected 2021/22 global trade is raised 2.3 million tons to a record 205.5 million on higher exports by Australia, EU, India, and Ukraine. The largest import change is for Iran, up 1.5 million tons to 7.0 million on further reductions in production and heightened import activity. These would the largest Iranian wheat imports on record, surpassing 6.8 million tons in 2008/09. Projected 2021/22 world ending stocks are raised 2.4 million tons to 278.2 million with most of the increases from Australia, Canada, and the United States. Despite upward revisions to global stocks this month, they are still at a 5-year low.
Finally for Cotton- The U.S. cotton 2021/22 supply and demand forecasts are largely unchanged this month, with only a slight increase in production. The U.S. production forecast is raised about 0.5 percent as higher yields in other regions offset lower yields for the Southwest. U.S. exports, mill use, and ending stocks are unchanged from their November forecasts. Upland cotton's projected season-average price is also unchanged from November, at 90 cents per pound, 36 percent above its year-earlier level.
Projected 2021/22 world cotton ending stocks are 1.2 million bales lower this month due to lower beginning stocks, lower production, and slightly higher consumption. Historical adjustments to Indian production over 2018-2020 reflect updated official estimates from India, resulting in a net 500,000-bale decline in 2021/22 beginning stocks there, and accounting for most of a 700,000-bale decline in global beginning stocks. Projected world production in 2021/22 is 200,000 bales lower this month as a 1.0 million bale drop in Pakistan more than offsets gains in Benin, Turkey, Uzbekistan, and Cameroon. World cotton trade is forecast 300,000 bales higher this month as higher expected imports for Pakistan, Vietnam, and smaller markets in Central America and Southeast Asia more than offset a 250,000-bale decline for China. Exports are projected higher for Brazil and the Franc Zone.
You can review the complete WASDE report for November by clicking here.
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The November Crop Production report from the National Ag Statistics Service updated only 2021 cotton and orange production, Click here for the complete report.
According to USDA- All cotton production is forecast at 18.3 million 480-pound bales, up less than 1 percent from the previous forecast, and up 25 percent from 2020. Based on conditions as of December 1, yields are expected to average 885 pounds per harvested acre, up 5 pounds from the previous forecast and up 38 pounds from 2020.
Upland cotton production is forecast at 17.9 million 480-pound bales, up less than 1 percent from the previous forecast and up 27 percent from 2020. Pima cotton production is forecast at 374,000 bales, up 8 percent from the previous forecast but down 32 percent from 2020. All cotton area harvested is forecast at 9.92 million acres, unchanged from the previous forecast, but up 20 percent from 2020.
Oklahoma's cotton crop was trimmed by just a few bales compared to the November estimate- dropping the total production estimate by 10,000 bales to 750,000 bales with an average yield of 867 pounds of lint per acre. The 2021 crop would be, if realized, 18 percent larger than the 2020 crop.
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