USDA Forecasts Large Corn and Soybean Crops for 2025-26, Wheat Production Up

The agricultural markets absorbed the latest World Agricultural Supply and Demand Estimates (WASDE) report released today by the USDA, revealing some unexpected figures in its initial outlook for the 2025 crop year. Rich Nelson from Allendale joined Farm Director KC Sheperd to break down the key findings

Wheat Production Surprises to the Upside:

The wheat market presented a different picture, with a notable surprise in the new crop production forecast. “Yield numbers for wheat at least, are live USDA can change them, and they showed an aggressive discussion on the winter wheat side of things here, total winter wheat crop 1.382 billion bushels. That was about almost 60 million over the trade estimate.”

Nelson attributed this strong production outlook, particularly for hard red winter wheat, to potentially favorable conditions, possibly including the recent rains in Oklahoma. “And the main driver of that was a very strong, hard red crop, 784 million bushels. This is, I believe, the second or third best hard red winter wheat yield we’ve had in the past 25 years. So big numbers there.”

However, this higher production led to a higher-than-expected new crop ending stock figure of 923 million bushels, which was almost 50 million bushels above the trade estimate. “So, there is a positive number for corn, a positive number for soybeans, and the wheat side, but a bit of a negative perspective overall,” Nelson summarized.

Corn Market Shows Bullish Signals:

Nelson pointed out that the USDA once again recognized stronger old-crop corn exports, leading to a lower ending stock figure. “USDA did see stronger exports on the old-crop side, and stocks were lowered to just over 1.4 billion bushels. Can you believe that just six or seven months ago, that number was 2 billion bushels? So we’ve certainly changed the old crop story quite a bit.”  

Looking ahead to the new crop, the USDA’s projection of 1.8 billion bushels for ending stocks came in below trade expectations of 2.0 billion bushels. “So USDA came out with maybe a little bit of story on the corn side than a lot of us expected. And if you throw in a little weather risk, this story could get even more exciting for the new crop side as well,” Nelson commented.

Soybean Stocks Lower Than Anticipated:

The soybean market also saw a revision in old crop numbers, with the USDA acknowledging better-than-expected exports. “Well, USDA recognized old crop exports, at least on this end, are a little better than expected. They took off, 25 million bushels off the ending stock. Number three, 50 million bushels now.”

For the new crop soybean balance sheet, Nelson highlighted the uncertainties surrounding trade issues and the recent China developments. Despite these factors, the USDA’s new crop ending stock projection of 295 million bushels was significantly below the trade estimate of 362 million bushels. “So USDA right now is starting the year off saying a decline in soybean stocks on the new crop on the new crop side.”

Looking Ahead at Market Influences:

Nelson cautioned that these are still early projections with a full year of potential market-moving events ahead. “So this is something which, like we said, starts the year off, and all these numbers are artificial. There’s a whole year in front of us, and there are many things in front of us. You know, keep in mind, we’re still talking about a summer weather risk for at least corn and soybeans.” He also emphasized the ongoing uncertainties surrounding trade relations. “Just because we had our past weekend of good news regarding China does not mean things are fixed, so this is still another risk issue in front of us.”

Cotton and Livestock Markets:

The report also touched on the cotton market, with USDA holding onto a hefty old crop stock number and projecting a potentially large new crop ending stock. The livestock numbers presented a mixed picture, with a lowered view of beef production for the year but an increase in imports, suggesting cattle prices are more influenced by consumer demand and imports than solely by production declines.

For the next WASDE report, Nelson anticipates fewer major changes for corn and soybeans in the near term. The wheat market will continue to be closely watched due to its live production balance sheet. The livestock sector’s import and export outlook will also be a key area of focus.

Farmers and market participants will analyze these initial estimates closely and monitor weather patterns and trade developments to gain further insights into the 2025 crop year. Click here to read more from Allendale.

You can also view the full reports here:

— Crop Production: https://www.nass.usda.gov/…

— World Agricultural Supply and Demand Estimates (WASDE): http://www.usda.gov/…

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