The World Agricultural Supply and Demand Estimates released Dec. 10 dealt an ugly blow to the wheat market, a market analyst said.
Peter Georgantones of Roy E. Abbott Futures of Minneapolis said supplies of wheat are building throughout the world.
The report raised global wheat supplies 5.3 million tons to 887.3 million, up 32.1 million tons from last year, but 9 million tons below the record supplies of 2011-12. Global 2013-14 production is up 5 million tons.
The ending stock number was raised 10 million bushels, and the projected season-average farm price was lowered 10 cents to $6.65 to $7.15 per bushel.
It will be a hard trudge in the wheat market, Georgantones said. Sell on a rally. It will take weather problems around the world to change the wheat price.
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Corn
World corn production is up 101.4 million tons from last year, and U.S. corn use for 2013-14 is projected higher, with increased use for food, seed, industrial use and exports. Corn used for ethanol and exports are projected to increase by 50 million bushels, but Georgantones is skeptical of the increased ethanol use number. The carryover was lowered 95 million bushels to 1.792 billion.
The WASDE report lowered the season-average corn price to $4.05 to $4.75 per bushel.
Soybeans
Soybean ending stocks for 2013-14 are projected at 150 million bushels, down 20 million from last month. That's what the trade was expecting, Georgantones said.
Prices for soybeans and soybean meal are projected higher. The U.S. season-average soybean price for 2013-14 is projected at $11.50 to $13.50 per bushel, up 35 cents on both ends of the range. Soybean meal prices are projected at $400 to $440 per short ton, up $25 dollars on both ends of the range.
Livestock
The forecast for 2014 is based on higher expected carcass weights for cattle and hogs and higher cattle slaughter. The turkey production forecast is reduced based on hatchery data.
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Beef exports are expected to increase in 2013 and 2014. Pork exports are reduced from last month because of weaker Asian demand. Turkey exports for 2013 are raised, but the forecast is unchanged for 2014.
Cattle prices for 2014 are raised from November, and hog prices are unchanged.
Milk
Lower expected feed costs are expected to lead to an increase in cow numbers and milk production in 2014. Higher milk prices also are forecast.
The all-milk price is forecast at $19.90 to $20 per hundredweight for 2013 and $19.70 to $20.50 per hundredweight for 2014.
