Anticipating USDA May Crop Report

Traders are gearing up for the upcoming USDA May crop report, poised to make significant market impacts with the inclusion of initial 2024/25 world and U.S. balance sheets.

Expectations for Crop Ending Stocks

Private analysts anticipate that both 2023/24 and 2024/25 corn ending stocks will surpass 2.0 billion bushels, with a projected increase of 160 million bushels. Similar increases are expected for wheat and soybean ending stocks in 2024/25.

Brazilian Crop Estimates and Russian Wheat Production

Market observers are keen to see if the notable gap between Brazilian and USDA crop estimates will narrow. Additionally, attention is on the USDA's stance regarding the 2024 Russian wheat crop amidst persisting hot and dry weather conditions.

Potential Market Impact

With expectations of increased ending stocks and the likelihood of high production estimates for South America and Russia, Friday's USDA reports could bear a bearish tone for U.S. futures markets. However, any bullish surprises may stem from reductions in South American crop sizes.

Forecast for U.S. Spring Seeding

A weeklong window for U.S. spring seeding, including corn, sorghum, and soybeans, is projected for the Central U.S., with wet weather expected to return on May 16th. This favorable weather period should facilitate substantial seeding progress, reflected in the upcoming Planting Progress report.

Projection of U.S. Corn Crop Size

Understanding the size of the U.S. corn crop involves analyzing harvested acreage and yield per acre. The USDA's Prospective Planting report provides a starting point, indicating intentions to plant 90 million acres of corn in 2024.

Yield Projections

Various models, including trend analysis and detailed weather-based models, are utilized to project corn yields. While trend analysis suggests an increasing yield trend, weather models incorporate factors like late plantings and precipitation, resulting in nuanced yield projections.