Going into the October USDA Grain Stocks Report corn was trading around 8 cents higher and beans were a couple cents higher. Right after the numbers were released at 11:00 this morning corn dropped to 8 cents lower and down 13 cents. Then a few minutes later beans dropped to almost 30 cents lower. Were the stocks numbers that bearish? i guess it depends on your perspective.

The USDA reported corn stocks of 1.236 billion bushel while the market was expecting stocks of 1.167 billion bushel. About 70 million bushel of corn above the guesses is not even a rounding error but at this point the corn bears believe it is? I suspect it is the bean market action that is dragging corn lower. The bean stocks came in today at 256 million bushel. The market anticipated soybean stocks of 172 million bushel.

Bean stocks were only 84 million bushel higher than the trade guess. But that took beans down hard. It is hard to see where the USDA came up with these extra corn and bean stocks. In the "real world" the basis around most of the Midwest suggests we are very tight in the cash market. Click on the link and listen to Gordy Kralovetz with Chiodo Commodities talk about the USDA numbers this morning.

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