With all the hype leading up to Tuesday’s WASDE report, many market advisors summarized the update in one word: deflating.
Record-setting sales to China in recent weeks led to speculation that big changes were on the horizon. But ultimately, the USDA didn’t make any major data moves.
Key highlights:
→ Corn underwhelms. The anticlimatic change in corn exports despite recent sales left corn prices reeling. The USDA also held firm on South American production numbers despite the dry weather spell.
→ Soybeans get tight. Soybean sales rose 20 million bushels, sending U.S. ending stocks to their tightest level in seven years. Even though its domestic soybean prices increased, China hasn’t called in new orders in the last few days. Those Lunar New Year celebrations are keeping them busy.
→ Beefed up. Expectations for higher slaughter rates and greater protein demand raised the projections across red meat and poultry. With high grain prices, producers may try to add more pounds outside of feedlots, slowing the flow of cattle and limiting beef production.