June 11, 2008

USDA report seen friendly for CBOT corn and soy

The USDA, June supply/demand and winter wheat production reports are seen as friendly for CBOT corn and soy futures and neutral for wheat, floor traders said Tuesday (June 10, 2008).

CBOT corn futures are called to open 3-5 cents per bushel higher, and soy are seen starting 5-10 cents higher. Wheat is called to open 4-6 cents higher.

The USDA tightened forecasts for old- and new-crop US soy carryout and for new-crop corn carryout. There also was an "aggressive" cut in the agency's projection for corn yields, an analyst said.

The June forecast for US wheat production for the 2008-09 marketing year was raised to 2.432 billion bushels, up from the USDA's May prediction of 2.392 billion bushel.

The market was already expecting a big crop so the increase was not seen as significant, a trader said.

"Winter wheat production is forecast 40 million bushels higher with higher yields expected in most states," the USDA said in the report.

The USDA raised its 2008-09 beginning stocks forecast by 15 million bushels, but only raised the ending stocks forecast by 5 million bushels.