The May World Agricultural Supply and Demand Estimates (WASDE) report, published by the USDA, stands out as one of the most significant reports of the year. It offers initial insights into new crop marketing year production, supplies, and usage estimates, alongside updated U.S. winter wheat production estimates and revisions to domestic balance sheets and South American crop forecasts.
Market Reaction and Analysis
Despite the anticipation surrounding the May 2024 WASDE, the market initially showed little reaction to the USDA’s findings. While U.S. corn, soybean, and wheat supplies are projected to increase in the upcoming marketing year, slight adjustments to current marketing year domestic usage help mitigate concerns about bearish prices. Moreover, declining global wheat stocks ahead of the 2024/25 marketing year have propelled rallies in the wheat market. Factors contributing to this include a 4% annual reduction in Russian production due to drought and recent frost damage, compounded by production cuts in Ukraine and the European Union, signaling tighter supplies for global wheat buyers.
Corn Outlook
In the corn sector, USDA forecasts larger supplies, greater domestic use and exports, and higher ending stocks. Corn production for 2024 is expected to reach 14.9 billion bushels, slightly below last season’s record. Yields are projected at 181.0 million bushels per acre. Total corn supplies are forecasted to reach 16.9 million bushels. The highest volume since 2017/18, with exports expected to increase to 2.2 billion bushels.
Soybean Projections
For soybeans, USDA anticipates higher supplies, crush, exports, and ending stocks compared to last year. Production could reach 4.45 billion bushels, with supplies forecasted at 4.8 billion bushels. Soybean crush and exports are also expected to increase, leaving U.S. share of global soybean exports at 28%. Ending stocks for 2024/25 are expected to rise to 445 million bushels, with season-average price forecasted at $11.20 per bushel.
Wheat Forecast
In the wheat sector, USDA projects larger supplies, modestly higher domestic use, increased exports, and higher stocks. All-wheat production is expected to increase by 3% to 1.858 billion bushels. Exports could rise to 775 million bushels, with ending stocks at 766 million bushels, the highest level in four years. The projected season-average farm price is expected to decline to $6.00 per bushel, $1.10 below 2023/24 levels.
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