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No Surprises in USDA February Numbers


WHEAT: U.S. 2015/16 wheat exports are lowered 25-million-bushels this month to 775 million. U.S. exports are lowered on increased international competition, especially from Canada. This export total is the lowest since 1971/72. U.S. wheat ending stocks are raised 25 million bushels and are the largest since 2009/10.

Global wheat supplies for 2015/16 are raised 2.1 million tons primarily on increased

beginning stocks and slightly larger production. The largest change to beginning stocks is a 2.0-million-ton increase for China, which is raised on a multi-year revision in total use. World beginning stocks are raised 1.7 million tons. World wheat production remains record high and is raised 0.4 million tons led by a 0.5-million-ton increase for Argentina and a 0.3-millionton increase for Ukraine. Kazakhstan is lowered 0.3 million tons. Foreign trade is raised 2.3 million tons led by a 1.5-million-ton increase for Canada exports on a fast pace to date. Argentina and Turkey exports are each raised 0.5 million tons. Imports are raised 0.5 million tons for Ethiopia on increased needs stemming from the drought, and 0.3 million tons each for China and South Korea.

World wheat consumption for 2015/16 is lowered 4.7 million tons led by a 4.0-million-ton decrease for China as government policies reduce the food and feed uses of wheat in favor of other grains. India consumption is lowered 2.9 million tons on government stocks data that was larger than expected. With wheat supplies increasing and total usage decreasing, global ending stocks are raised 6.8 million tons to a record 238.9 million tons.

COARSE GRAINS: U.S. feed grain ending stocks for 2015/16 are projected higher this month with corn imports raised and exports lowered. Corn imports are projected 10 million bushels higher based on recent imports of corn into southeastern U.S. feed markets. Corn exports are projected 50 million bushels lower as larger supplies of South American corn further increase competition for U.S. exports. Partly offsetting is a 25-million-bushel increase in projected U.S. corn use for ethanol based on the strong pace of ethanol production during January, as indicated by weekly Energy Information Administration (EIA) data, and higher forecast gasoline consumption. Corn ending stocks for 2015/16 are raised 35 million bushels. The projected range for the corn season-average farm price is narrowed 5 cents on both ends to $3.35 to $3.85 per bushel.

Global coarse grain supplies for 2015/16 are projected 1.3 million tons higher. Higher Brazil and Argentina corn production more than offset lower corn beginning stocks in these same countries and lower production elsewhere. Brazil and Argentina 2015/16 beginning stocks are lowered with higher 2014/15 exports. Brazil corn production for 2015/16 is raised 2.5 million tons based on higher first-crop yields and indications that strong domestic corn prices, reflecting the devalued local currency, will increase second-crop plantings. Argentina corn production is increased 1.4 million tons on higher area. Argentina corn production is revised higher for 2014/15, also on higher area. South Africa corn production for 2015/16 is lowered 1.0 million tons, as continued historic drought conditions further reduce crop prospects despite some stabilizing rain during the month of January. Indonesia corn production is reduced 0.5 million tons. Other coarse grain production changes are mostly offsetting with sorghum lowered for Mexico, rye raised for EU, and barley increased for Argentina. Global coarse grain consumption for 2015/16 is raised 0.9 million tons with foreign consumption up 0.2 million tons. The largest change this month is a 2.0-million-ton increase in China corn feed use as relative internal market prices are expected to support greater corn feeding at the expense of wheat. Corn use is also increased for Mexico, India and Turkey.

Partially offsetting are corn feeding reductions for Brazil and Argentina. Sorghum feed use is lowered for Mexico.

Global coarse grain imports for 2015/16 are raised 4.3 million tons with corn imports higher for South Africa, Iran, India, Indonesia, Mexico, and Turkey. Corn exports are raised for Brazil, Argentina, and South Africa, but lowered for the United States. Barley exports are raised for Argentina and Kazakhstan, with higher imports for Saudi Arabia. Global coarse grain ending stocks for 2015/16 are slightly higher, as larger barley and rye stocks more than offset a small reduction for corn.

OILSEEDS: U.S. soybean ending stocks for 2015/16 are projected at 450 million bushels, up 10 million from last month due to a lower crush. Soybean production, trade, and other uses remain unchanged. Crush is reduced 10 million bushels to 1,880 million reflecting a lower soybean meal export forecast. Meal exports are reduced on sluggish shipments and sales as well as greater expected competition from Argentina where larger projected soybean supplies boost soybean meal exports. Lower U.S. soybean meal exports are partly offset by increased domestic soybean meal use which is raised to reflect relatively strong October-December disappearance. Soybean oil stocks are projected lower as reduced WASDE-550-3 production more than offsets larger imports and a higher extraction rate. Soybean oil imports are raised on large shipments from Canada.

The 2015/16 season-average soybean price range projection is unchanged at $8.05 to $9.55 per bushel. Soybean meal and oil price projections are also unchanged at $270 to $310 per short ton and 28.5 to 31.5 cents per pound, respectively.

Global oilseed production for 2015/16 is projected at 527.4 million tons, up slightly from last month as an increase in soybean production more than offsets lower forecasts for peanuts and sunflowerseed. Soybean production in Argentina is projected up 1.5 million tons to 58.5 million on a higher yield projection. The revised yield forecast is in line with an adjustment to last year’s yield and is also supported by beneficial rain that has improved crop prospects.

Peanut production in India is reduced this month on lower area. Global sunflowerseed production is projected lower as a decrease for Russia more than offsets higher production in Ukraine.

Global 2015/16 soybean and product supply and use changes include increased soybean crush for Argentina and Canada, increased soybean meal and oil exports for Argentina, increased soybean oil exports for Canada, and reduced soybean meal exports for India. In addition to the United States, higher soybean meal disappearance is projected for India where soybean meal substitutes for lower peanut meal disappearance. Soybean meal disappearance is also raised for Canada. Global oilseed stocks are projected at 91.2 million tons, up 0.3 million. Higher soybean stocks in Argentina, the United States, and Turkey, more than offset lower rapeseed stocks in the EU and Canada.

Source: USDA

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