WASDE Report: Wheat Prices Fall, Corn and Soybeans Steady

Strong U.S. production of wheat, Brazil’s soybean crop remains unaffected and corn gains slightly on reduced stocks

• Wheat prices decline after WASDE report on strong U.S. production.
• Soybeans remain mostly unchanged as Brazil’s crop is largely unaffected.
• Corn holds gains on slightly reduced ending stocks.

The United States Department of Agriculture (USDA) released its World Agricultural Supply and Demand Estimates (WASDE) today, which introduced some volatility into wheat, and left soybean and corn markets largely unfazed. Those products remain mostly lower from the beginning of the year, as supply pressures remain in the market.

Wheat contracts (/ZWN4) saw the biggest move of the day, holding their nearly 2% loss through the report’s release.

The June WASDE projected smaller global supplies, consumption, trade, and ending stocks for 2024/25. Supplies came in at 1,050.3 million tons, a decrease of 5.7 million tons from May, because of reduced production from Russia, Ukraine and the European Union.

Adverse weather in Russia and Ukraine dropped production projections by 5 million tons for Russia and 1.5 million tons for Ukraine. Wet weather in France hurt the European Union’s projection by decreasing France’s growing degree days and yield potential. Overall, the resulting projection for ending stocks dropped by 1.3 million tons to 252.3 million.

U.S. wheat prices are likely holding losses because of the call for larger U.S. supplies, led by hard red winter production, which leaves ending stocks much higher than the year before at 758 million bushels. Additionally, Brazil saw smaller-than-anticipated crop reductions.

Soybean prices not phased by WASDE

Soybean contracts (/ZSN4) were nearly unchanged on the day, following an initial upside reaction to the report.

The WASDE’s 2024/25 projection for the global soybean market called for lower beginning and ending stocks. The U.S. beginning and ending stocks for June rose by 10 million bushels, with crushings, exports and total use remaining unchanged.

However, the report lowered global beginning and ending stocks. Brazil’s 2023/24 production was cut by 1 million bushels to 153 million because of heavy rains and flooding in Rio Grande do Sul. This reduction wasn't as significant as some traders anticipated, likely explaining why soybean prices didn’t drop. Paraguay’s 2024/25 beginning stocks were reduced because of higher exports from the previous marketing year. The resulting global ending stocks number was trimmed by 0.6 million tons to 127.9 million.

Corn prices hold gains on small adjustments

Corn prices maintained gains on slightly reduced ending stocks. Global beginning and ending stocks for corn saw small adjustments, with beginning stocks falling to 312.39 million metric tons from May’s 313.90, while ending stocks fell to 310 million metric tons from 312.27 for the 2024/25 marketing year.

The U.S. beginning and ending stocks remained unchanged at 51.36 and 53.39 million metric tons. Stocks in Brazil and Argentina, both major exporters, were also unchanged. Russia’s ending stocks fell from 0.91 million metric tons to 0.41, while Ukraine’s ending stocks remained constant at 1.48 million metric tons.

The USDA left corn’s season average price unchanged at $4.40 per bushel. Global coarse grain production for 2024/25 fell by 1.4 million tons to 1.511 billion. The USDA’s acreage report on June 28, a survey-based indicator for planted and harvested areas, will help inform the outlook for corn next month.

Corn prices have given back most of the gains made in early June that was driven by adverse planting conditions across the corn belt, and are now trading near the middle of a range carved out from February to May.

Thomas Westwater, a tastylive financial writer and analyst, has eight years of markets and trading experience. @fxwestwater

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