Market Report: Is the February USDA Report Friendly?

This morning at 11, the USDA released the February Supply Demand Report. Corn carryover dropped by 50 million bushels to 1.827 billion bushels. Soybean carryover dropped by 25 million bushels to 385 million bushels. Both of those numbers were even below the average trade guess.

We are in a world market, so you have to consider the world carryover estimates, too. World corn carryover went from 189.15 million metric tons (MMT) to 189.64 MMT. While it did go up, it is not much more than a rounding error. World carryover for soybeans actually dropped from 190.78 MMT to 66.16 MMT this month. The USDA left South American production pretty well unchanged.

If you just look at these numbers, you would think corn and soybeans would have closed higher today. Well, corn was down about 3 cents and soybeans down more than 9 cents. One might argue the report was already in the market, but there might be another reason. The "Funds" like to sell on slightly friendly USDA Reports, as has been the pattern in the past!