Photo by Evi Radauscher on Unsplash

WHEAT

This month’s supply and demand outlook for 2023/24 U.S. wheat is for lower supplies, reduced domestic use, unchanged exports, and higher ending stocks. Supplies are tightened with a reduction in projected imports by 5 million bushels to 140 million on a slower-than-expected import pace, primarily for Hard Red Winter. Domestic consumption is forecast down on lower-than-expected implied feed and residual use in the second and third quarters based on the latest NASS Grain Stocks report. As a result, annual feed and residual use is lowered 30 million bushels to 90 million. Projected 2023/24 ending stocks are raised 25 million bushels to 698 million, 22 percent above last year. The season-average farm price is reduced $0.05 per bushel to $7.10.
The 2023/24 global wheat outlook this month is for larger supplies, consumption, and exports and smaller ending stocks. Supplies are raised 0.6 million tons to 1,058.4 million on increased production estimates for the EU, Moldova, and Pakistan. The world consumption forecast is increased 1.1 million tons to 800.1 million. Food, Seed, and Industrial use in India is increased 2.0 million tons this month to 106.2 million. The latest monthly stocks reports issued by the Food Corporation of India shows continued open market sales as the Government of India attempts to limit food price inflation ahead of elections, which begin later this month. Global feed and residual use is forecast lower on reductions for Russia and the United States that are only partly offset by increased use for the EU.
Projected 2023/24 global trade is raised 1.3 million tons to 213.5 million, mostly on higher export forecasts for Russia and Ukraine that are only partly offset by a reduction for the European Union. Russia’s export forecast is raised 1.0 million tons to 52.0 million, as shipments have continued at a robust pace. Ukraine exports are raised, up 1.5 million tons to 17.5 million as competitive prices and expanded operating hours at the ports of Odessa this year allow trade to increase. EU exports, however, are reduced 2.0 million tons to 34.5 million as competition from the Black Sea has restrained their exports to date. Projected 2023/24 world ending stocks are down 0.6 million tons to 258.3 million as lower stocks for India and Ukraine are only partly offset by increases for Algeria and the EU. If realized, global stocks for 2023/24 would be five percent below last year and the lowest since 2015/16.

COARSE GRAINS

This month’s 2023/24 U.S. corn outlook is for greater corn used for ethanol and feed and residual use and smaller ending stocks. Corn used for ethanol is raised 25 million bushels to 5.4 billion based on data through February from the Grain Crushings and Co-Products Production report and weekly ethanol production data as reported by the Energy Information Administration for the month of March. Feed and residual use is increased 25 million to 5.7 billion based on indicated disappearance during the December-February quarter. With no supply changes and use rising, ending stocks are lowered 50 million bushels to 2.1 billion bushels. The season-average farm price is lowered 5 cents to $4.70 per bushel.
Global coarse grain production for 2023/24 is forecast 2.3 million tons lower to 1,505.1 million. This month’s foreign coarse grain outlook is for declines in production, trade, and ending stocks. Foreign corn production is forecast lower as cuts for South Africa, Argentina, Mexico, and Moldova are partially offset by increases for the EU and the Philippines. Corn production is cut for South Africa as a continuation of drought during March further reduces yield prospects. Argentina and Mexico are both lowered reflecting a decline in yield expectations. EU corn production is raised mostly reflecting increases for Hungary, Poland, Spain, and France that are partly offset by declines for Romania, Slovakia, and Bulgaria. Foreign barley production is virtually unchanged.
Major global trade changes for 2023/24 include lower forecast corn exports for South Africa, India, and Tanzania but an increase for Russia. Corn imports are lowered for the EU, Saudi Arabia, Bangladesh, Thailand, Cuba, and Kenya but raised for Mexico. Barley imports are raised for China but lowered for Saudi Arabia and Algeria. Foreign corn ending stocks are essentially unchanged, mostly reflecting declines for Mexico and South Africa that are offset by small increases for several countries. Global corn ending stocks, at 318.3 million tons, are down 1.4 million from last month.

RICE

The outlook for 2023/24 U.S. rice this month is for unchanged supplies, reduced domestic use, higher exports, and increased ending stocks. Total domestic and residual use is lowered 5.0 million cwt to 157.0 million with all of the decline for long-grain. This is the result of a reduction in the December-February quarter in implied disappearance compared to a year earlier as indicated in the latest NASS Rice Stocks report. Total exports are raised 3.0 million cwt to 91.0 million as higher long-grain exports are partially offset by a reduction in medium- and short-grain. Long-grain exports, now at 70.0 million cwt, would be the highest since 2016/17 despite current long-grain prices significantly higher than 2016/17. Sustained higher sales and shipments of long-grain rough rice to Mexico, Central America, Venezuela, and Colombia drive this increase. Despite larger exports, the reduction in domestic and residual use more than offsets the export increase resulting in higher ending stocks, up 2.0 million cwt to 43.5 million. The season-average price for all rice is unchanged at $18.80 per cwt with prices by class also unchanged.
The 2023/24 global outlook this month is for larger supplies, lower consumption, modestly higher trade, and higher ending stocks. Supplies are raised 0.9 million tons to 693.5 million, primarily on higher beginning stocks for Cambodia and Burma. World 2023/24 consumption is lowered 1.5 million tons to a still record 521.3 million, largely on a reduction for China. India’s export restrictions on broken rice and fewer Chinese auctions of old-crop rice are factors causing this reduction. Global 2023/24 trade is raised 0.4 million tons to 52.9 million on higher exports for Burma, Cambodia, Vietnam, and the United States more than offsetting lower China exports. Projected world ending stocks are raised 2.5 million tons to 172.2 million primarily on increases for China, Vietnam, and Bangladesh.

OILSEEDS

The outlook for U.S. soybean supply and use for 2023/24 includes lower imports, residual, and exports, and higher ending stocks. Soybean trade is reduced on pace to date and expectations for future shipments. With the trade changes and slightly lower residual, soybean ending stocks are raised 25 million bushels to 340 million. The U.S. season-average soybean price for 2023/24 is forecast at $12.55 per bushel, down 10 cents. Soybean meal and oil prices are unchanged at $380 per short ton and 49 cents per pound, respectively.
Global 2023/24 soybean supply and demand forecasts include lower production, exports, crush, and nearly unchanged ending stocks. Soybean production is lowered mainly for South Africa on drought conditions during the season, which negatively impacted yield potential. Partly offsetting is higher production for Paraguay, up 0.2 million tons to 10.5 million.
Global soybean exports are lowered 0.5 million tons to 173.1 million mainly on lower exports for the United States and South Africa partly offset by higher shipments for Paraguay. Imports are lowered for Indonesia, Russia, Algeria, and the United States, but raised for the EU. Global soybean ending stocks are nearly unchanged with higher stocks for the United States offset by lower stocks for Canada, Iran, and Russia.

SUGAR

Mexico production for 2023/24 is projected at 4.572 million metric tons (MT), a decrease of 175,090 from last month and 651,856 lower than last year. Area harvested is running over 20,000 hectares below the level forecast by CONADESUCA resulting in the current USDA projection of 727,116 hectares. Interim analysis based on the CONADESUCA production data through March 30 supports an increase in sugarcane yield from last month to 62.25 MT/hectare and also in sucrose recovery to 10.10 percent. However, the area reduction more than offsets the yield and recovery increases to reach this month’s projection of sugar production. Production of low polarity sugar is reduced by 107,206 MT to 320,067 as producers have hastened the trend toward more profitable estandar sugar for the domestic market at the expense of less low polarity sugar. The low polarity sugar share of total production is at 7 percent, down from 9 percent last month. Assuming that all projected low polarity sugar is exported to the U.S. market and like last year constitutes 75 percent of the total exported, exports to the United States are projected at 426,757 MT, a decrease of 142,941. On April 5, the Secretaría de Economía in Mexico announced that it would temporarily accept imports of sugar intended for use in the IMMEX program until August 31 with each shipment requiring its approval. This effectively means that imports from the United States under USDA’s re-export import program can be shipped duty-free into Mexico only for use in IMMEX. Thus, 50,000-MT worth of Mexico production for IMMEX can be redirected to deliveries for human consumption. With more net sugar available, IMMEX is projected 25,000 MT higher at 425,000 MT. Given that Mexico has imported 435,000 MT of high-tier tariff sugar for consumption through March 31, USDA projects imports in the pipeline at 40,000 MT, implying imports for consumption at 475,000 MT. Total imports are, therefore, at 575,000 MT. Exports to other countries are residually projected at 43,914 MT.
U.S. beet sugar production for 2023/24 is decreased by 27,340 short tons, raw value (STRV) to 5.144 million on lower forecast sucrose recovery. Beet pile shrink is unchanged at 9 percent. Cane sugar production is unchanged. TRQ imports are up 25,086 STRV to 1.775 million on higher imports expected from Argentina and Panama. TRQ shortfall falls by that same amount to 66,690 STRV. Imports from Mexico decrease by 167,020 STRV to 498,644 but are largely offset by an increase of high-tier tariff imports of 140,000 STRV (all raw sugar) to bring the total to 855,000. This pace-to-date adjustment reflects that imports for the remaining 6 months of the fiscal year will be close to imports for the first 6 months. Exports are increased by 37,634 STRV to 197,634 as increased program exports more than offset a reduction of other sugar exports to Mexico. Deliveries for consumption are unchanged. Deliveries for human consumption were low in February due to a likely underreporting of direct consumption imports in February that will see an offsetting expansion in March. Ending stocks are projected at 1.722 million STRV for an ending stocks-to-use ratio of 13.50 percent.

LIVESTOCK, POULTRY, AND DAIRY

For 2024, red meat and poultry production is raised from last month. Beef production is raised due to heavier weights and higher slaughter. Pork production is raised on higher hog slaughter more than offsetting a slight decline in weights. The current outlook for hog slaughter in 2024 reflects the information provided in the March 28 Quarterly Hogs and Pigs report that showed higher pig crops than previously reported for 2023 and continued strong growth in pigs per litter in early 2024. Broiler production is raised based on recent production and hatchery data, as well as a continuing trend of heavier bird weights. Turkey production is raised for the first quarter on recent production and hatchery data. Egg production is lowered based on recent discoveries of Highly Pathogenic Avian Influenza (HPAI) in commercial laying flocks.
Beef exports are raised for 2024 based on recent trade data. Pork exports are also raised based on strong exports reported through the first two months of the year. Larger U.S. pork supplies will support exports. Broiler exports are lowered based on recent trade data and expectations that higher prices may affect trade to a number of price sensitive markets. Turkey exports are unchanged. Egg exports are raised slightly based on recent trade data.
Cattle prices are raised for the year based on recent data and expected strength in demand. Hog prices are also raised based on reported data and stronger-than-expected demand. Broiler prices are raised based on recent price strength carrying into the rest of the year. Turkey prices are lowered based on latest reported data and continued signs of relatively weak demand. Egg prices are raised due to recent prices and expectations of tighter supplies.
The milk production forecast for 2024 is lowered on slower expected growth in milk per cow; cow numbers are unchanged from last month. Fat basis imports for 2024 are raised on higher expected butter and cheese imports. Skim-solids basis imports are raised for a number of dairy products. Fat basis exports are raised on strong international demand for butter and price competitiveness of U.S. cheese. Skim-solids basis exports are lowered as fewer expected shipments of lactose and whey products more than offset higher shipments of nonfat dry milk (NDM) and cheese.
Butter prices for 2024 are raised on observed prices and continued strength in demand. Cheese, NDM, and whey prices are all lowered on recent prices. Class III prices are lowered due to lower cheese and whey price forecasts. Class IV prices are raised due to higher butter prices more than offsetting lower NDM prices. The all milk price for 2024 is projected lower at $20.90 per cwt.

COTTON

The U.S. 2023/24 cotton supply and demand projections are unchanged this month, with ending stocks forecast at 2.5 million bales or 18 percent of total disappearance. The marketing year price received by upland cotton producers is projected to average 76 cents per pound, a decrease of 1 cent from last month.
The global cotton supply and demand estimates for 2023/24 show higher trade and lower ending stocks compared with last month. World production and consumption are mostly unchanged. World trade for 2023/24 is projected 700,000 bales higher this month to nearly 44 million, as a 1.3-million-bale increase in China’s imports is only partially offset by reductions for Pakistan and Indonesia. Brazil, Australia, and Turkey exports are all projected higher. Ending stocks for 2023/24 are projected down nearly 300,000 bales this month as lower stocks across West Africa, Australia, and Brazil more than offset higher supplies in China.
Approved by the Secretary of Agriculture and the Chairman of the World Agricultural Outlook Board, Mark Jekanowski, (202) 720-6030. This report was prepared by the Interagency Commodity Estimates Committees.

WHEAT 

General Comments: Wheat was lower in response to the supply and demand reports that showed higher than expected ending stocks estimates from USDA. Trends remain mixed in all three markets. The problems with Russian Wheat exporters continue. The reports indicate that the government is seeking more control of the exports and has made life very difficult on the private exporters in an effort to extract more sales and powers to the government. Russia is the world’s largest exporter and sets the world price and prices remain low. Big world supplies and low world prices are still around. Export sales remain weak on competition from Russia, Ukraine, and the EU as those countries look to export a lot of Wheat in the coming period. Black Sea offers are still plentiful, but Russia has been bombing Ukraine again and shipments might be hurt from that origin.
Overnight News: The southern Great Plains should get Scattered showers. Temperatures should be below normal. Northern areas should see scattered showers. Temperatures will average below normal. The Canadian Prairies should see scattered showers. Temperatures should average below normal.
Chart Analysis: Trends in Chicago are mixed. Support is at 539, 537, and 527 May, with resistance at 568, 575, and 580 May. Trends in Kansas City are mixed. Support is at 571, 561, and 552 May, with resistance at 597, 602, and 605 May. Trends in Minneapolis are mixed. Support is at 634, 625, and 618 May, and resistance is at 650, 655, and 660 May.

RICE 

General Comments: Rice closed lower in reaction to the USDA supply and demand reports. USDA cut domestic demand a lot but increased export demand for increased ending stocks levels. USDA also increased world ending stocks estimates for the year. Trends are up in this market on the daily charts. The market noted good planting and emergence progress in the weekly USDA reports released on Monday afternoon. Good demand for exports continues.
Overnight News:
Chart Analysis: Trends are mixed to up with objectives of 1748 May. Support is at 1659, 1632, and 1602 May and resistance is at 1751, 1760, and 1773 May.

CORN AND OATS

General Comments: Corn closed lower and Oats closed higher as traders think that good Spring weather here will greatly increase planted Corn area. The USDA supply and demand reports showed reductions in Corn ending stocks in line with trade expectations but still over 20 billion bushels. Increased demand was noted in all domestic categories, but export demand was left unchanged. South American production estimates were little changed. It is very expensive to plant Corn and Corn is considered unprofitable to plant right now, so planted are might not increase that much if at all. USDA issued its crop progress report for Corn and Corn planting is proceeding slowly. Demand for Corn has been strong at lower prices. Big supplies and reports of limited demand are still around, but futures have been very oversold. Funds remain very large shorts in the market.
Overnight News:
Chart Analysis: Trends in Corn are mixed. Support is at 426, 422, and 408 May, and resistance is at 437, 448, and 459 May. Trends in Oats are mixed. Support is at 334, 328, and 322 May, and resistance is at 349, 353, and 359 May.

SOYBEANS

General Comments: Soybeans and the products closed lower in response to the USDA supply and demand estimates that showed a greater increase in US ending stocks than the market had anticipated. South American production estimates were little changed. Brazil producers had been taking advantage on higher futures in the US and higher basis levels in Brazil, but the basis has fallen sharply in Brazil this week and sales have been less. Reports of great export demand in Brazil provide some support. Reports indicate that China has been a very active buyer of Brazil Soybeans this season. Ideas that South American production is taking demand from the US have pressured futures lower. Funds remain large shorts in the market. The US reports strong domestic demand.
Overnight News: Ubnknown destinations bought 124,000 tons of US Soybeans.
Chart Analysis: Trends in Soybeans are mixed to down with objectives of 1150 and 1138 May. Support is at 1152, 1140, and 1128 May, and resistance is at 1181, 1193, and 1207 May. Trends in Soybean Meal are mixed. Support is at 330.00, 325.00, and 323.00 May, and resistance is at 340.00, 348.00, and 352.00 May. Trends in Soybean Oil are down with objectives of 4670 and 4430 May. Support is at 4550, 4520, and 4420 May, with resistance at 4730, 4830, and 4980 May.

CANOLA AND PALM OIL

General Comments: Palm Oil was lowr today in sympathy with the price action in Chicago yesterday.. The export pace is expected to continue to really improve but this is part of the price already, in part due to stronger world petroleum prices that have affected world vegetable oils prices as well. Domestic biofuels demand is likely to improve. Ideas of weaker production ideas against good demand still support the market overall. Trends are turning up on the daily charts. Canola was lower in response to the USDA reports that showed plenty of oilseeds viable in the US and the world.
Overnight News:
Chart Analysis: Trends in Canola are mixed to down with objectives of 617.00 and 596.00 May. Support is at 616.00, 610.00, and 602.00 May, with resistance at 637.00, 645.00, and 652.00 May. Trends in Palm Oil are mixed. Support is at 4260, 4200, and 4130 May, with resistance at 4440, 4460, and 4490 May.

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