USDA Released The May WASDE Report

DR. AARON SMITH

KNOXVILLE, TENNESSEE

On Friday the USDA released the May WASDE report. The May release provides the first WASDE estimates for the new crop. 

U.S. corn production was projected at 14.86 billion bushels based on harvested area of 82.1 million acres and a national average yield of 181 bu/acre. Exports were projected to increase by 50 million bushels. Ending stocks for the 2024/25 marketing year were projected at 2.102 billion bushels, up 80 million bushels compared to the previous marketing year. Foreign corn stocks were projected down 111 million bushels compared to the previous marketing year. For the day, corn futures reacted positively, gaining 12 to 13 cents for the front three contracts. 

U.S. soybean production was projected at 4.45 billion bushels based on harvested area of 85.6 million acres and a national average yield of 52 bu/acre. Both crushing and exports were projected to increase by 125 million bushels. Ending stocks for the 2024/25 marketing year were projected at 445 billion bushels, up 105 million bushels compared to the previous marketing year. Foreign soybean stocks were projected up 510 million bushels compared to the previous marketing year. For the day, soybean futures gained 7 to 10 cents for the front three contracts. 

U.S. cotton production was projected at 16 million bales based on harvested area of 9.13 million acres and a national average yield of 842 lbs/acre. Exports were projected to increase by 0.7 million bales. Ending stocks for the 2024/25 marketing year were projected at 3.7 million bales, up 1.3 million bales compared to the previous marketing year. Foreign cotton stocks were projected up 1.23 million bales compared to the previous marketing year. For the day, cotton futures lost 1.01 to 1.33 cents for the front three contracts. 

U.S. wheat production was projected at 1.858 billion bushels based on harvested area of 38 million acres and a national average yield of 48.9 bu/acre. Exports were projected to increase by 55 million bushels. Ending stocks for the 2024/25 marketing year were projected at 766 million bushels, up 78 million bushels compared to the previous marketing year. Foreign wheat stocks were projected down 233 million bushels compared to the previous marketing year. For the day, Chicago wheat futures reacted positively gaining 23 to 26 cents for the front three contracts. 

Corn

Across Tennessee, average corn basis (cash price-nearby futures price) strengthened or remained unchanged at West, North- west, West-Central, North-Central, and Mississippi River elevators and barge points. Overall, basis for the week ranged from 75 under to 8 over, with an average of 20 under the July futures at elevators and barge points. Ethanol production for the week ending May 3 was 0.965 million barrels per day, down 22,000 from the previous week. Ethanol stocks were 24.2 million barrels, down 1.288 million barrels compared to last week. Corn net sales reported by exporters for April 26-May 2 were net sales of 35 million bushels for the 2023/24 marketing year and 1.9 million bushels for the 2024/25 marketing year. Exports for the same period were down 11% compared to last week at 48.5 million bushels. Corn export sales and commitments were 89% of the USDA estimated total annual exports for the 2023/24 marketing year (September 1 to August 31) compared to the previous 5- year average of 96%. July 2024 corn futures closed at $4.69, up 9 cents since last Friday. Jul/Sep and July/Dec future spreads were 11 and 23 cents. For the week July 2024 corn futures traded between $4.54 and $4.72. 

The Crop Progress report estimated corn planted at 36% compared to 27% last week, 42% last year, and a 5-year average of 39%; and corn emerged at 12% compared to 7% last week, 10% last year, and a 5-year average of 9%. In Tennessee, corn planting was estimated at 65% compared to 49% last week, 74% last year, and a 5-year average of 64%; and corn emerged at 32% compared to 5% last week, 12% last year, and a 5-year average of 33%. September 2024 corn futures closed at $4.80, up 11 cents since last Friday. New crop cash prices ranged from $4.00 to $4.70 at elevators and barge points. December 2024 corn futures closed at $4.92, up 10 cents since last Friday. Downside price protection could be obtained by purchasing a $5.00 December 2024 Put Option costing 40 cents establishing a $4.60 futures floor. 

Soybeans

Across Tennessee the average soybean basis weakened or remained unchanged at West, Northwest, West-Central, North- Central, and Mississippi River elevators and barge points. Basis ranged from 38 under to even the July futures contract, with an average basis at the end of the week of 20 under. Soybean net weekly sales reported by exporters were net sales of 15.8 million bushels for the 2023/24 marketing year and 0.2 million bushels for the 2024/25 marketing year. Exports for the same peri- od were up 13% compared to last week at 11.2 million bushels. Soybean export sales and commitments were 91% of the USDA estimated total annual exports for the 2023/24 marketing year (September 1 to August 31), compared to the previous 5-year average of 97%. July 2024 soybean futures closed at $12.19, up 4 cents since last Friday. For the week July 2024 soybean futures traded between $12.04 and $12.56. July 2024 soybean-to-corn price ratio was 2.60 at the end of the week. Jul/Aug and Jul/Nov future spreads were 1 and -14 cents. August 2024 soybean futures closed at $12.20, up 4 cents since last Friday. 

The Crop Progress report estimated soybeans planted at 25% compared to 18% last week, 30% last year, and a 5-year average of 21%; and soybeans emerged at 9% compared to 7% last year and a 5-year average of 4%. In Tennessee, soybean planting was estimated at 38% compared to 28% last week, 34% last year, and a 5-year average of 18%; and soybeans emerged at 12% compared to 6% last year and a 5-year average of 3%. New crop cash soybean prices at elevators and barge points ranged from $11.68 to $12.16. November 2024 soybean futures closed at $12.05, up 4 cents since last Friday. Downside price protection could be achieved by purchasing a $12.20 November 2024 Put Option which would cost 74 cents and set an $11.46 futures floor. Nov/Dec soybean-to-corn price ratio was 2.45 at the end of the week. 

Cotton

North Delta upland cotton spot price quotes for May 9 were 74.35 cents/lb (41-4-34) and 76.35 cents/lb (31-3-35). Adjusted World Price (AWP) decreased 0.91 cents to 59.64 cents. Cotton net weekly sales reported by exporters were 253,700 bales for the 2023/24 marketing year and 158,900 bales for the 2024/25 marketing year. Exports for the same period were up 39% compared to last week at 249,600 bales. Upland cotton export sales were 101% of the USDA estimated total annual exports for the 2023/24 marketing year (August 1 to July 31), compared to the previous 5-year average of 108%. July 2024 cotton futures closed at 77.31 cents, down 0.75 cents since last Friday. For the week July 2024 cotton futures traded between 76.51 and 80.29 cents. Jul/Dec and Jul/Mar cotton futures spreads were -2.18 cents and -0.58 cents. 

The Crop Progress report estimated cotton planted at 24% compared to 15% last week, 20% last year, and a 5-year average of 20%. In Tennessee, cotton planting was estimated at 16% compared to 5% last week, 12% last year, and a 5-year average of 8%. December 2024 cotton futures closed at 75.13 cents, down 0.84 cents since last Friday. Downside price protection could be obtained by purchasing a 76 cent December 2024 Put Option costing 4.85 cents establishing a 71.15 cent futures floor. March 2025 cotton futures closed at 76.73 cents, down 0.63 cents since last Friday. 

Wheat 

Wheat net weekly sales reported by exporters were net sales of 1.5 million bushels for the 2023/24 marketing year and net sales of 14.9 million bushels for the 2024/25 marketing year. Exports for the same period were down 34% compared to last week at 12.4 million bushels. Wheat export sales were 98% of the USDA estimated total annual exports for the 2023/24 marketing year (June 1 to May 31), compared to the previous 5-year average of 105%. Wheat cash prices at elevators and barge points ranged from $5.84 to $6.22. 

The Crop Progress report indicated winter wheat condition at 50% good-to-excellent and 16% poor-to-very poor; winter wheat headed at 43% compared to 30% last week, 34% last year, and a 5-year average of 32%; spring wheat planted at 47% compared to 34% last week, 21% last year, and a 5-year average of 31%; and spring wheat emerged at 12% compared to 5% last week, 4% last year, and a 5-year average of 9%. In Tennessee, winter wheat condition was estimated at 79% good-to-excellent and 7% poor-to-very poor; winter wheat jointing at 96% compared to 92% last week and 96% last year; and winter wheat headed at 83% compared to 60% last week, 78% last year, and a 5-year average of 76%. July 2024 wheat futures closed at $6.63, up 41 cents since last Friday. July wheat-to-corn price ratio was 1.41. Jul/Sep and Jul/Jul future spreads were 19 and 59 cents. July 2024 wheat futures traded between $6.09 and $6.65 this week. Downside price protection could be obtained by purchasing a $6.65 July 2024 Put Option costing 39 cents establishing a $6.26 futures floor. New crop wheat cash prices at elevators and barge points ranged from $6.02 to $6.34. September 2024 wheat futures closed at $6.82, up 39 cents since last Friday. July 2025 wheat futures closed at $7.22, up 24 cents since last Friday.  ∆

DR. AARON SMITH: University of Tennessee