Nogger's Blog

09/11/10 -- The much awaited USDA numbers are out and generally look bullish, especially for beans.

They cut soybean yields by half a bushel/acre from last month when a 0.3bpa increase was what the trade was expecting. That cut production by 33 million bushels against forecasts for an increase of 25 million. Soybean 2010/11 ending stocks came in well below expectations, falling 80 million bushels to 185 million compared to the 243 million the market was expecting. That cuts stocks to use to 5.5% or the equivalent of just 20 days worth of supply.

Corn yields and production were cut a bit more than expected, taking ending stocks down by 75 million bushels to 827 million, 18 million less than anticipated. That equates to a stocks to use ratio of just 6.2%.

They also cut 2010/11 all wheat production by 15 million bushels to 2.209 billion and trimmed ending stocks by 5 million against forecasts for a small 3 million increase. Even so at 848 million that is a very comfortable 34.7% stocks to use ratio.

On a global level world corn ending stocks were reduced by 3.2 MMT to 129.2 MMT, even though they upped Chinese production 2 MMT to 168 MMT. That will raise a few eyebrows. That pegs world stocks to usage at only 56 days of supply, the 2nd tightest of the past 35 years.

They dropped world wheat ending stocks by 2.2 MMT to 174.7 MMT (Russian output trimmed by half a million tonnes to 42 MMT).

World soybean ending stocks were almost unchanged at 61.41 MMT. China's import requirements for 2010/11 were raised 2 MMT to 57 MMT.

Early calls for this afternoon's CBOT session: corn and wheat up 10 to 20, beans up 40 to 50.