Setzer: USDA’s April WASDE Report ‘Friendly’ for Corn, Soybeans

We saw gains for corn and soybean futures following the release of USDA’s WASDE (World Agricultural Supply and Demand Estimates) Report at 12 p.m. ET on Thursday.

“I was surprised by the market reaction that we saw today, but not necessarily from the data that came out from the USDA,” says Karl Setzer with Consus Ag Consulting.

“One shining spot in the entire report was U.S. corn carryout coming down 75 million bushels this month to 1.465 billion bushels. Trade was expecting 1.51 million bushels,” according to Setzer. “Trade increased our exports by 100 million bushels this month, trimming our feed demand by 25 million bushels. Trade is questioning that a little bit, but the 75 million bushel cut to ending stocks was a good number there taking us a little bit closer to where we may have to do some rationing in the complex.

“Not really much of a change for soybeans,” says Setzer. “We only cut carryout to five million bushels this month to 375 million bushels total. USDA says that we’ll likely see elevated crushes as we move through the last half of the marketing year, and tariffs start to take their effect on the market. There is some concern that we could see some slow soybean exports, but we will also see a decline in vegetable oil imports out of the Asian market—mainly used cooking oil out of China.

“All-in-all, it was a pretty friendly report,” says Setzer as the data provided support for corn and soybeans.

Setzer adds that traders are also paying close attention to the escalating trade war with China.

“The U.S. now has a 145-percent tariff on all Chinese imports, which will start to impact the US economy. This news negated the cooler than expected inflation data for March,” says Setzer.

Settlements from Thursday, April 10:

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