USDA Report Figures

Production>
Corn=  13.168 bil, vs 13.261 bil avg, range= 13.083-13.485, Oct USDA= 13.318
Beans=  2.594 bil, vs 2.606 bil avg, range= 2.573-2.662, Oct USDA= 2.598

Carryout>
Corn=  1.897 bil, vs 1.932 bil avg, range= 1.562-2.050, Oct USDA= 1.997
Beans= 210 mil, vs 213 mil avg, range= 189-236, Oct USDA= 215

Reactions:
Knee-jerk reaction will be bullish corn due to the smaller than expected crop. HOWEVER, with carryout declining only 35 mil bushels and still 1.9 bil, there shouldn't be much enthusiasm to buy strength this morning. The trade has been expecting bullish data and is poised to experience "sell the fact" activity. Calls should only be slightly higher.

Soybeans will have the word "neutral" attached to the spin. Here too, the market is vulnerable to "sell the fact" activity.

It is worth noting that USDA increased China's corn production estimate 2 mmt from last month. This is a surprise. Also, world wheat carryout was raised 3 mmt, while world corn carryout was left unchanged.

I don't believe this morning's report data is enough to further build/sustain upside price momentum.

Published Friday, November 09, 2007 7:26 AM
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