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U.S. corn futures fell to three-year lows Friday after the U.S. Department of Agriculture reported that U.S. corn stockpiles increased to their highest levels since 2018 and forecast higher than expected production for the 2023-24 crop.
The USDA said it sees U.S. corn supplies rising more than use, prompting it to raise its ending stocks forecast by 31M bushels.
A record U.S. corn harvest in 2023 and lackluster export sales have contributed to growing stocks and weighed down seven corn futures contracts to new lows, including the most-active March contract (C_1:COM), which finished -2% to $4.48 1/2 per bushel.
CBOT wheat (W_1:COM) for March delivery ended -1.1% to $5.96 1/2 per bushel, and March soybeans (S_1:COM) settled -0.8% to $12.25 3/4 a bushel, with prices hitting a 26-month low.
ETFs: (NYSEARCA:CORN), (NYSEARCA:WEAT), (NYSEARCA:SOYB), (DBA), (MOO)
In its latest monthly WASDE report, the USDA forecast U.S. corn production will total 15.34B bushels and soybean output of 4.17B bushels, with both results up from last month’s projections and slightly above expectations.
The USDA also reported inventories for the December quarter were mostly higher from a year earlier and above analyst estimates, with corn stocks totaling 12.17B bushels and wheat stocks at 1.41B bushels; soybean stocks fell slightly from a year ago to ~3B bushels.
“The bottom line is very simple: We’re out-producing our demand right now, and that’s pressuring the entire market,” Karl Setzer, partner at Consus Ag Consulting, told Reuters.
