US Grains Tumble Following USDA Report

09/11/16 -- Soycomplex: Beans closed sharply lower. The USDA put 2016 national soybean yields at 52.5 bu/acre with production at 4.361 billion bushels (118.7 MMT). There were 51.4 bu/acre and 116.2 MMT last month. The trade was expectring yields to rise, but only to around 52.0 bu/acre. The larger than expected yield/production number spilled over into a bigger 2016/17 carryout than the markey had been anticipating. That was raised from 395 million bu last month to 480 million this time round (the average trade forecast was around 420 million bu). There were no changes to production in Brazil (102 MMT) or Argentina (57 MMT), nor China's import needs (86 MMT). Global ending stocks were raised from 77.4 MMT to 81.5 MMT. Nov 16 Soybeans settled at $9.82, down 19 3/4 cents; Jan 17 Soybeans settled at $9.91, down 20 1/4 cents; Dec 16 Soybean Meal settled at $311.40, down $4.30; Dec 16 Soybean Oil settled at 34.31, down 100 points.

Corn: Corn closed sharply lower after the USDA surprised the market by raising the average 2016 US corn yield by almost 2 bu/acre to 175.3 bu/acre. The market was expecting a tweak lower to around 173 bu/acre. The new yield figure took production up to a new record 15.226 billion bushels versus an average trade guess of 15.017 billion. US 2016/16 ending stocks were placed at 2.403 billion bu, around 100 million above trade expectations. "In the Black Sea region, Russia is harvesting a new record crop for the second consecutive year, while Ukraine is collecting a near-record crop," they noted. They increased their estimate for Russian production from 14.0 MMT To 14.5 MMT and upped Ukraine from 26 MMT to 27 MMT. Export potential out of both countries was also tweaked higher. World ending stocks came in at 218.2 MMT versus 216.8 MMT a month ago. Weekly US ethanol production data from the Energy Dept showed a 20,000 barrels/day fall from last week. Dec 16 Corn settled at $3.40 3/4, down 13 1/2 cents; Mar 17 Corn settled at $3.49 3/4, down 13 cents.

Wheat: Wheat closed mostly lower, although Minneapolis did manage a small net gain. A bearish corn yield and production estimate from the USDA dragged wheat down, not that the numbers contained anything bullish for wheat either. Global production and ending stocks (including those in the US) were nudged higher. There were no changes to world exports in 2016/17 save for those from "others" with Russia, Ukraine, Australia, Canada and the EU all unaltered from a month ago. Egypt will remain the world's largest wheat buyer, with an import requirement of 11.8 MMT in 2016/17, they said. Russia said that they'd currently gathered a 2016 grain harvest of 120.8 MMT off 95.4% of the planned area. That includes 75.8 MMT if wheat off 98.1% of plan and 19.1 MMT of barley (off 97% of plan). Russian winter grains planting works are said to be complete on 17.2 million ha (98.9% of the government forecast) versus only 15.8 million ha this time a year ago. Dec 16 CBOT Wheat settled at $4.06 3/4, down 8 1/2 cents; Dec 16 KCBT Wheat settled at $4.10 1/4, down 7 1/4 cents; Dec 16 MGEX Wheat settled at $5.14 1/2, up 1/2 cent.