Chicago Board of Trade Market News
Outlook: USDA published their October 10 WASDE report with revised estimates for total production and acreage. In summary, the report held no surprises for feed grains and prices soon returned to trading as though the report was a nonevent.
The October estimate of the average U.S. corn yield is 174.2 bushels per acre (bu.). That was a 2.50 bu. increase above the September estimate of 171.7 bu., but a half bushel lower than the average market estimate of 174.7 bu. The estimate of harvested U.S. corn acreage was reduced by 600,000 acres to 83.1 million acres, however, this reduction was not sizable enough to create any excitement. The end result of these (and other small adjustments) is that the total U.S. corn ending stocks for the 2014/15 season were forecast to increase from the September estimate of 2.002 billion bushels to 2.081 billion bushels for the new October estimate. That adjustment to ending stocks is not large enough to cause any major reaction in corn futures prices. Nor was there a sufficient surprise within soybean or wheat data to have much of an indirect influence on feed grain prices. Thus, market participants returned to trading harvest progress, weather and global demand as the much anticipated October WASDE report came and went without fanfare.
The outlook is that any return to the low prices of October 1 will now be perceived as a buying opportunity in corn contracts. However, any further upside also seems limited as weakness in the soy complex and wheat dampens the likelihood of bullish enthusiasm in grain markets for the next couple of months. The extension of a trading range is the most probable scenario for corn contracts through year-end.