Corn: No changes are made to this month’s 2016/17 U.S. corn supply and use projections. Forecast U.S. corn exports are unchanged this month, despite a sales and shipment pace that is well above a year ago. In recent years, early-season U.S. corn export commitments have not been a robust indicator of final exports, and it is expected that the U.S. will likely face strong competition from South America beginning in the first part of 2017. The projected range for the season-average corn price received by producers is raised 5 cents on both ends to $3.05 to $3.65 per bushel, on continued higher-than-expected early-season prices.
Soybeans: Soybean supply and use projections for 2016/17 are unchanged from last month. Although early-season soybean exports are sharply higher than a year ago, competition from South America is expected to be strong in the second half of the marketing year, limiting U.S. export prospects during the summer of 2017 relative to the prior year. Soybean ending stocks are projected at 480 million bushels which, if realized, would be the highest since 2006/07.
The U.S. season-average soybean price for 2016/17 is forecast at $8.70 to $10.20 per bushel, up 25 cents on both ends of the range. Soybean oil is forecast at 34.5 to 37.5 cents per pound, up 2 cents on both ends. The soybean meal price forecast is unchanged at $305 to $345 per short ton.
Wheat: The U.S. 2016/17 all wheat supply and demand estimates are unchanged from November. The marketing year average price received by producers is unchanged at the midpoint, but the range is narrowed $0.20 per bushel to $3.60 to $3.80.
Global wheat production for 2016/17 is raised 6.5 million tons led by a 4.7-million-ton increase for Australia, a 0.9-million-ton increase for China, and 0.4-million-ton increases for both the EU and Brazil. Higher area estimated by ABARES combined with a USDA yield projection that reflects near ideal weather support the large Australia production increase. Prior to this change, USDA had already projected a record Australia yield. However, the new yield is up 18 percent from the previous record. Production increases for China, the EU, and Brazil are due to updated official data.
With supplies growing faster than use, ending stocks are raised 2.9 million tons and remain record large.
Rice: The U.S. 2016/17 all rice supply and demand estimates are mostly unchanged from last month. The only adjustment to the balance sheet is a 1.0-million-cwt increase in rough exports that is offset by an equivalent reduction in milled exports. These changes reflect export pace to date. Overall rice exports remain projected at 112.0 million cwt. The all rice marketing year average price is lowered $0.20 per cwt at the midpoint to a range of $9.90 to $10.90 on lower projected California prices.
Global rice production for 2016/17 is lowered 2.3 million tons to 481.5 million tons led by a 1.7-million-ton reduction for China and a 0.5-million-ton reduction for the Philippines. With total supplies falling faster than use this month, world ending stocks are lowered 1.5 million tons but up 3 percent from the prior year.
Sugar: Minor adjustments are made to the 2015/16 U.S. sugar supply and use balance based on revised Sweetener Market Data (SMD) submitted by processors to USDA. For 2016/17, Hawaii cane sugar production is raised by 6,000 short tons, raw value, based on close to end of season processor reporting. Texas cane sugar production is raised by 5,000 short tons, raw value, based on increased crop yield reported by NASS. The projection of 2016/17 beet sugar production is unchanged as lower-than-expected sucrose levels in certain parts of the Red River Valley and Michigan are countered by strong content and record crop yields in western growing areas.
Cotton: This month’s 2016/17 U.S. cotton forecasts include increased production, lower domestic mill use, and higher exports and ending stocks. Production is raised 362,000 bales to 16.5 million due to an increase for Texas, which is partially offset by decreases for the Carolina’s. Domestic mill use is reduced 200,000 bales as recent activity indicates a slowdown in pace compared to the year-ago level. The export projection is raised 200,000 bales on higher production. Ending stocks are now projected at 4.8 million bales or 31 percent of disappearance. The global 2016/17 forecasts likewise show higher production and increased ending stocks compared with last month.
Livestock, Poultry, and Dairy: The 2016 forecast of total red meat and poultry production is raised from last month as higher forecast beef production offsets lower poultry and pork production. Beef production is raised on the current pace of slaughter. Pork production is lowered due to counter-seasonally lighter-than-expected carcass weights this quarter. Broiler and turkey production is forecast lower, largely reflecting the slower pace of slaughter in the fourth quarter. For 2017, pork and broiler production forecasts are unchanged from the previous month, but beef and turkey production forecasts are lowered.
However, the ensuing decline in fed cattle slaughter will be slightly offset by higher expected cow slaughter. The turkey production forecast is lowered from the previous month as a slower pace of slaughter is expected in the second half of the year. Egg production is forecast higher for both 2016 and early 2017.
Cattle prices are forecast higher for the remainder of 2016 and through the first half of 2017 as demand has improved and is expected to carry into early 2017. Hog prices are unchanged. Broiler prices are raised for 2016 and 2017 on recent price strength. Turkey prices are lowered in 2016 and 2017 on weaker-than-expected demand. For 2016, egg prices are lowered reflecting current price data, but the price forecast for 2017 is unchanged.
The milk production forecast is lowered for both 2016 and 2017 as slower growth in cow numbers more than offsets slightly higher growth in milk per cow.
Price forecasts for cheese and butter are raised for 2016 on current price strength.