EGG‑NEWS.com

OVERVIEW

The USDA provided updated projections for the production of corn and soybeans in the November 8^thWorld Agriculture Supply and Demand Estimates (WASDE) #654, reflecting the 2024 crop. Production values for corn and soybeans were updated from the September edition and are based on actual field data. Projections of crop size and ending stocks are derived from acreage planted, updated yields from the harvest approaching completion, carry-forward levels from 2023, and with the latest assumptions relating to domestic use and exports.

The November 8^th WASDE report predicted that corn would be harvested from 82.7 million acres, unchanged from the October projection. The soybean crop will be harvested from 86.3 million acres, unchanged from the October report.

The November WASDE reduced the yield value for the 2024 corn crop by 0.4 percent to 183.1 bushels per acre. By comparison yield was 174.9 bushels per acre in 2023. The November projection of soybean yield was lowered by a substantial 2.6 percent from the previous WASDE to 51.7 bushels per acre compared to 49.9 bushels per acre in 2023.

The October USDA projection for the ending stocks of corn was down 2.8 percent to 1,999 million bushels. The October USDA projection for the ending stock of soybeans was unchanged at 550 million bushels.

The November 2024 WASDE held the projection of corn price at 410 cents per bushel. The projected average season price for soybeans was held at 1,080 cents per bushel. The price of soybean meal was unchanged at $320 per ton. Projected commodity prices suggest stable to lower feed costs for livestock and poultry producers. Row crop farmers will experience lower margins or in some areas corn will be below break-even given relative production costs and per bushel price. This situation has contributed to an impasse in the decisions of the respective House and Senate Agriculture Committees regarding allocation of funding for the combination of nutrition support and conservation over farm commodity price supports in the delayed Farm Bill.

Projections for world output included in the November 2024 WASDE report, reflect the most recent estimates for the production and export of commodities especially in the Southern Hemisphere with an emphasis on Argentine and Brazil. Economists also evaluated the likely impacts from a transition to a La Nina event especially on South America. Hostilities are ongoing in Ukraine following extensive destruction of agricultural infrastructure by the Russian Federation. Production and hence exports of wheat, corn and sunflower from Ukraine will be reduced compared to pre-war averages.

It is accepted that USDA projections for export are also based on the perceived intentions and needs of China. This Nation has sharply curtailed purchases of commodities and especially U.S. soybeans during the current market year despite fiscal stimulus with a projected recovery of the Nation’s economy influencing consumer demand for food and fuel.

Reports on volumes of commodities exported are included in weekly editions of EGG-NEWS, derived from USDA-FAS sales data. Weekly Crop Progress reports will be posted through late November

CORN

Based on current yield and acreage projections for the 2024 corn harvest, the November WASDE Report predicted a crop of 15,413 million bushels, down 0.4 percent from October and compared to 15,234 million bushels for the previous 2023 record harvest. The “Feed and Residual” category was held at 5,825 million bushels. The Food and Seed category was unchanged at 1,390 million bushels. The Ethanol and Byproducts Category was unchanged at 5,450 million bushels consistent with estimated demand for E-10 and higher blends for fall driving needs. Projected corn exports were held at 2,325 million bushels, based on recent orders, and ongoing shipments to China and taking into account the anticipated lower availability of coarse grains from Eastern Europe and as a result of drought in producing nations in South America. For market year 2023-2024 exports of U.S. corn were 36.9 percent higher, compared to the previous market year. For the first eight weeks of the 2024-2025 market year corn exports were 31.9 percent higher than for the corresponding week in the previous market year. The USDA considers world weather patterns in developing projections including the effect of the transition to a La Nina event during the present quarter. The anticipated ending stock of corn in the November WASDE report was down 3.1 percent from the October WASDE to 1,938 million bushels.

The forecast USDA average season farm price for corn in the November WASDE report covering the 2024 crop was unchanged at 410 cents per bushel. At market close on November 8^th after the noon release of the WASDE the CME spot price for corn was 432 cents per bushel, up 3.3 percent from the quotation on October 11^th and up 5.1 percent from the November USDA projection.

NOVEMBER 2024 WASDE #654 Projections For The 2024 Corn Harvest:

1 metric ton = 39.368 bushels

Average Farm Price: 410 cents per bushel. (Unchanged since the September WASDE Report reflecting the 2024 projected crop)

SOYBEANS

Based on acreage planted and adjusted yield, the USDA October WASDE projected the 2024 soybean crop at 4,462 million bushels, down 2.6 percent from October with an estimated yield of 51.7 bushels per acre from 86.3 million acres harvested. Crush volume was down 0.6 percent from the October WASDE report at 2,410 million bushels despite increased industry capacity. Projected exports were down 1.4 percent to 1,825 million bushels in part due to reduced demand by China. For market year 2023-2024 exports were down 14.9 percent from the previous market year. For the first eight weeks of the 2024-2025 market year exports were up 6.2 percent over the corresponding week in the previous market year. Ending stocks were anticipated to be 470 million bushels, down 14.5 percent from the October WASDE report. This was mainly due to the projected decrease in production and carry over as compared to previous WASDE projections.

There is uncertainty over orders from China for the current market year. This is attributed to competition from Brazil and an assumption of lower requirements for animal feed due to restrictions on pork production by the Central Government of China. The response of China with respect to anticipated import and punitive tariffs imposed will be predictably negative with respect to volume and domestic U.S. prices. In reality traders in China are obligated to order on a stable or declining market unless faced with shortages. Prior to 2018, China, the largest trading partner for U.S. agricultural commodities, imported the equivalent of 25 percent of U.S. soybeans harvested.

The USDA November 2024 projection for the ex-farm price for soybeans for the 2024 harvest was unchanged since August at 1,080 cents per bushel. At market close on November 8^th following release of the WASDE, the CME spot price was 1,030 cents per bushel, up 2.1 percent compared to the October 11^th quotation and 4.6 percent above the November USDA projection.

November 2024 WASDE #654 Projection for the 2024 Soybean Harvest:-

1 metric ton = 36.74 bushels

Average Farm Price: 1,080 cents per bushel (Unchanged since the August 2024 WASDE Report)

SOYBEAN MEAL

The projected production of soybean meal from the 2024 soybean crop will be 56.75 million tons, down 0.6 percent from the October WASDE and consistent with the 2,410 million bushel projected soybean crush volume. This figure also corresponds to stagnant demand for biodiesel despite expanded U.S. crushing capacity. Production is driven both by exports and domestic consumption for livestock feed and for soy oil supplying the food and biodiesel segments. The projection of domestic use was down 0.2 percent to 40,025 million tons. Exports were down 0.6 percent to 17.40 million tons.

The USDA held the ex plant price of soybean meal in the November WASDE at $320 per ton as an average for the season based on supply and demand considerations as reflected in a stable ending stock of 450,000 tons representing 0.8 percent of supply.

At market close on November 8^th the CME spot price for soybean meal was $297 per ton, down 6.3 percent compared to the October 11^th CME quotation and 7.1 percent lower than the WASDE projection of $320 per ton.

NOVEMBER 2024 WASDE #654 Projection of Soybean Meal Production and Use

(Quantities in thousand short tons)

Average Price ex plant:$320 per ton (Unchanged since the August WASDE Report)

IMPLICATIONS FOR PRODUCTION COST

The price projections based on CME quotations for corn and soybeans suggest lower feed production costs for broilers and eggs. Going forward, prices of commodities will be determined by World supply and demand and U.S. domestic yield, use and exports.

For each 10 cents per bushel change in corn:-

• The cost of egg production would change by 0.45 cent per dozen
• The cost of broiler production would change by 0.25 cent per live pound

For each $10 per ton change in the cost of soybean meal:-

• The cost of egg production would change by 0.35 cent per doze
• The cost of broiler production would change by 0.30 cent per live pound.

WORLD SITUATION

With respect to world coarse grains and oilseeds the November 2024 WASDE Report included the following appraisals by USDA:-

COARSE GRAINS:

“Global coarse grain production for 2024/25 is forecast fractionally lower at 1.500 billion tons. This month’s 2024/25 foreign coarse grain outlook is for larger production, lower trade, and smaller ending stocks relative to last month. Foreign corn production is forecast higher as increases for Uganda, Malawi, Belarus, Mozambique, Kenya, and Cameroon are partly offset by declines for Mexico, Turkey, and the EU. Mexico production is lowered reflecting lower winter corn area expectations. Foreign barley production is cut, mostly reflecting a reduction for Russia that is partly offset by an increase for Kazakhstan.”

“Major global trade changes include lower corn exports for Brazil and South Africa with increases for Burma and Uganda. Corn imports are reduced for China and Malawi but raised for Mexico, Vietnam, Turkey, and Peru. Barley exports are reduced for Russia. Foreign corn ending stocks are down, mostly reflecting a decline for China that is partly offset by increases for Mexico, Uganda, and Canada. Global corn ending stocks, at 304.1 million tons, are down 2.4 million.”

OIL SEEDS:

“The global 2024/25 soybean supply and demand forecast includes lower production, higher exports, lower crush, and lower ending stocks. Global 2024/25 soybean production is lowered 3.5 million tons to 425.4 million, mainly on lower production for the United States and India. Production for India is lowered 0.2 million tons to 12.6 million on information from the Soybean Processors Association (SOPA) of India. Global soybean exports are raised on higher shipments for Brazil, Canada, and Benin largely offset by lower U.S. shipments. Imports are raised for Pakistan. Higher crush for Pakistan is more than offset by lower crush for the United States. Global soybean ending stocks are reduced 2.9 million tons to 131.7 million mainly on lower stocks for the United States, Brazil, and Argentina.”

World and U.S. Data Combined for Coarse Grains and Oilseeds:-

*Values rounded to one million metric ton

(1 metric ton corn= 39.37 bushels) (“ton” represents 2,000 pounds)