US Corn, Soy Ending Stocks to Build Only Slightly in 2021-22

Early new-crop outlooks suggest that despite larger expected crops in 2021, US corn and soybean ending stocks will remain tight.

That is especially the case for soybeans, with ending stocks for the upcoming 2021-22 marketing year projected at just 145 million – a minor 25-million increase from the current year. Corn ending stocks, meanwhile, are seen building only 50 million to 1.6 billion bu. Amid the supply tightness, new-crop soybean prices are pegged at US$11.25/bu, up slightly from 2020-21, while the season average corn price is forecast to ease 10 cents to $4.20/bu.

The projections were released Friday morning as part of the USDA’s annual Agricultural Outlook Forum, which was being held virtually this year.

With a big increase in expected planted area – up 8.3% from 2020 to 90 million acres – new-crop US soybean production is projected at 4.52 billion bu, 9% above a year earlier with plantings recovering from last year’s weather-related decline and a return to trend yields. The national average yield forecast of 50.8 bu/acre is based on a weather-adjusted trend assuming normal growing season weather and is up from 50.2 bu last year.

On the demand side, the 2021-22 soybean crush is projected at a record 2.21 billion bu, driven by higher domestic use of soybean meal that more than offsets expected lower meal exports. Soybean exports for 2021-22 are projected at 2.2 billion bu, down 50 million from the forecast for 2020-21. Despite increasing global import demand, US market share is likely to decline on limited exportable supplies, the USDA said.

At 145 million bu, 2021-22 soybean ending stocks would still be historically low relative to projected use at 3.2%, compared to 2.6% for 2020-21.

The 2021 corn crop is projected at 15.15 billion bu, 7% above a year ago with planted area increasing 1.2 million acres to 92 million. The average yield is pegged at 179.5 bu/acre, up from 172 bu a year earlier, once again based on the assumption of normal planting progress and summer weather.

Total US corn use in 2021-22 is forecast to rise 3% from a year ago on growth in domestic use and continued strength in exports.

Corn used for ethanol is projected up 5% from the current year to 5.2 billion bu, based mostly on expectations of increased gasoline consumption following the COVID-19 related weakness seen during 2020-21. Feed and residual use for 2021-22 is estimated up 200 million bu to 5.85 billion, with a larger crop and lower expected prices. Corn exports are forecast up 50 million bu to 2.65 billion, ‘reflecting expectations of global trade growth and continued robust demand from China.’

Source: DePutter Publishing Ltd.

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