Grain markets are preparing for the USDA’s January data dump on Monday. Historically, the January report day is one of the most volatile of the year, as it attempts to put a bow on the previous growing season in the WASDE. The Quarterly Grain Stocks report is also released on the same day, which leads to additional demand adjustments from the previous quarter.
Yields back in focus
The January WASDE report will likely make final yield and production adjustments for corn and soybeans. A Bloomberg survey of analyst estimates expects the USDA to lower the national average corn yield to 184 bushels per acre (bpa), down 2 bushels from the previous report. On average, analysts expect production to be lowered by nearly 200 million bushels to (still a record) 16.55 billion.
On the demand side, the current export pace for corn suggests the USDA could further raise export demand beyond the current record of 3.2 billion. However, slower export sales have shown up in the past couple of weeks of reports.
Accumulated corn ethanol crushings for the marketing year reached approximately 1.892 billion bushels, reaching 34 percent of the USDA’s 2025/26 target. Processors are currently on pace to meet the 5.6 billion-bushel target, with the forecast likely to remain unchanged on Monday.
Even with reduced production, ending stocks could remain above the 2-billion-bushel level. Corn feed and residual usage remain high and allows room for the USDA to lower demand. Still, analysts expect a 43 million-bushel reduction in the 2025/26 ending stocks forecast.
The U.S. soybean yield is expected to be lowered slightly to 52.7 bpa, down 0.3 bushels from December. Production is expected to fall by 20 million bushels to 4.23 billion.
For demand, U.S. soybean crushings remain healthy and are sitting 8 percent above last year so far this season. The USDA currently forecasts domestic crush to increase by 4.5 percent from the previous season to 2.555 billion bushels. Meanwhile, there is a growing case for the need to reduce the soybean export forecast. China stepped back in the game as our largest soybean buyer this season. Updated export sales data now shows China has bought a confirmed total of about 7.4 MMT of U.S. soybeans and are on track to hit the proposed 12 MMT target outlined by the Trump Administration.
U.S. soybean ending stocks are expected to be raised slightly by 4 million bushels to 294 million. The U.S. ending stocks forecast remains neutral to slightly tight despite weak exports.
U.S. wheat ending stocks are expected to decline slightly from December to 896 million bushels. No change is expected for supplies. The U.S. wheat export pace has been running ahead of last year’s pace and the five-year average. However, slowing sales in December will likely keep the USDA from raising its export forecast. The world wheat balance sheet will continue to play a large role. Global wheat ending stocks are expected to rise another 1.1 million metric tons to 276 million.
Quarterly Grain Stocks
The average analyst guess for the Dec. 1 corn stocks estimate is 12.98 billion bushels, up 7.5 percent from December 2024. If realized, that would be a record inventory for the quarter following a historical harvest this past season. A record corn harvest this year is expected to raise inventories compared to a year ago, reversing the trend of declining stocks throughout the year.
On average, the market predicts Dec. 1 soybean stocks at 3.26 billion bushels, up 5.1 percent year-over-year. Sluggish export demand will likely prevent stocks from decreasing compared to last year. U.S. exporters hadn’t begun shipping soybeans to China until December. Steady exports throughout the season are expected to keep wheat stocks from swelling too much. The Dec. 1 estimate is expected to total 1.637 billion bushels, up 64 million from December 2024.
Winter crop seedings enter the equation
The wheat market will be honing in on the winter wheat seedings data, which will also be released on Monday. All winter wheat acreage is expected to decrease by 800,000 acres to 32.4 million. If realized, that would put winter wheat acreage at the lowest since the 2020 growing season, as global export competition pressures prices. Lower HRW wheat acres are expected to drive the decrease, along with modest reductions for SRW and white winter wheat plantings.