Opinion: What The USDA Might Say Today

11/09/15 -- For what it's worth I think that this afternoon's USDA report will be bearish. I'm not saying that the trade ideas on soybean and corn production/yields are wrong, but I don't see the USDA confirming them as correct today.

This time last year they pegged both corn and soybean yields and production higher than the trade anticipated. For the record they then went on to raise both again in October. It wasn't until November that they started to fine tune yields closer to where they eventually ended up.

Obviously there's a lot more hard info to go on then (November) than there is right now as far as yields go.

Note that in Sep 2014 they had corn yields at 171.7 bu/acre, these were then increased again in Oct to 174.2 bu/acre. It is now accepted that they ultimately ended up at 171 bu/acre. (Even in Nov they were only reduced to 173.4 bu/acre).

They surprised the market in August this year by raising both corn and soybean yields when the trade was expecting them to be lowered.

Will they fall into line with trade expectations today? We shall have to wait a few more hours yet to find out, but their track record says no. Consider that they have very little new yield evidence to go on just yet. Also back in August they had soybeans rated 63% good to excellent and corn at 70% G/E. The former are still at 63% G/E, although the latter has dropped 2 points in the top 2 categories since, that hardly looks like a game changer to me.

But what do I know...