August 19

8/19 - Last week’s Crop Production report shocked the corn market. The USDA said that U.S. farmers planted 90.0M acres of corn this year, down from last month’s 91.7M forecast. But traders had expected big, flood-driven losses in the 3M-6M acre range. Corn output was revised down from 13.9B bushels to 13.8B, compared to an average trade estimate of just 13.1B. The USDA increased corn yield from 166.0 to 169.5 bushels per acre, when a reduction was expected. In its Aug. WASDE report, the USDA decreased both exports and corn usage for ethanol, raised ending stocks, and lowered its 2019/20 corn price forecast from $3.70 to $3.60 per bushel. Corn futures, which hit highs of $4.54 on 7/12, fell by 21% to $3.59 (8/14) before recovering a bit to $3.71 on Friday.

Sheena Levi