Grain Comments: 09.13.23

Several adjustments were made in US balance sheets in the monthly WASDE report, with the market response being mostly bearish. Only subtle changes were made to US corn balance sheets which left ending stocks close to unchanged from the August report. The stocks to use on 2023/24 corn is holding at 15.4% which is not at a point where rationing would be needed. Soybean ending stocks are forecast to tighten 30 million bu (mbu) by the end of the 2023/24 marketing year to 220 mbu. This is a 5.2% stocks to use and warrants elevated rationing. Traders were hesitant to extend their long soybean position though as the global outlook on soybeans is much less threatening. Global ending stocks are forecast to remain unchanged due to elevated South American production and this limited any buying interest in the complex. This was the first WASDE report to contain field collected data, but the data was taken prior to the intense weather the crop was subjected to in early September. Many analysts feel that this will set the market up for a bullish surprise in the October release. That may be true, but by then actual harvest data will have more of an impact on price discovery.

Highlights

* Black Sea fertilizer values +17.5%

* Russia shows no interest in Black Sea corridor

* US consumers start to limit spending

* Fed shows concern over possible recession

* Global logistic issues slow trade

* Low water greatest restriction

* Several US rivers being dredged

* Ukraine to take EU bans to WTO

* Market now focused on harvest data

* Sep futures expire tomorrow

Corn

* US corn yield est 173.8 bpa

* US crop est 15.13 bbu; +23 mbu

* 22/23 carryout 1.145 bbu; -5 mbu

* 23/24 carryout 2.22 bbu; +18 mbu

* No change to South American 23/24 production

Soybeans

* US yield est 50.1 bpa

* US crop est 4.146 bbu; -59 mbu

* 22/23 carryout 250 mbu; -10 mbu

* 23/24 ending stocks 220 mbu; -25 mbu

* No changes to South American 23/24 production