The 2014 U.S. corn crop, while still a record, will be slightly below recent market expectations according to government data released on Monday, giving a small boost to beaten-down corn prices, while soybean production continues to rise.
CBOT corn futures rose about 6 cents per bushel on the bullishly construed data. Soybean futures tried in vain to ride corn's momentum but succumbed to profit-taking.
The U.S. Department of Agriculture trimmed its corn crop estimate to 14.407 billion bushels from 14.475 billion in October, and lowered ending stocks to 2.008 billion bushels from 2.081 billion. Traders had leaned toward higher estimates.
"It was surprising to see the revision lower in corn production. The trade solidly felt an increase was due," said Rich Nelson, chief strategist at Allendale Inc.
USDA's fourth round of 2014 crop estimates mostly reflected fine tuning, though, with a hearty dose of harvested data to inform the agency's estimates.
USDA estimated the U.S. soybean crop at a record 3.958 billion bushels, up less than 1 percent from October and a hair below trade forecasts averaging 3.967 billion. The crop is inching closer to the once unthought-of 4 billion-bushel mark.
Projected 2014/15 U.S. soybean ending stocks were steady on the month at 450 million bushels.
USDA raised its export and crush forecasts by a combined 30 million bushels to absorb the larger crop, a potential boon to major grain processors and exporters.
U.S. corn yields will be a record 173.4 bushels per acre, with 22 states expected to post new yield marks. Nov. 1 yield data shows the highest number of ears on record for the 10 primary growing states, USDA said.
Soybeans were also in great shape. Compared with final results for 2013, pod counts are up in eight of the 11 published states, USDA said. Fifteen states are heading toward record high soybean yields, including No. 1 producer Illinois.
Forecast U.S. wheat carryout was lowered by 10 million bushels, to 644 million, as a notable cut in stocks of hard red spring wheat more than offset higher stocks of hard red winter wheat. USDA resurveyed some states' wheat crops and lowered the 2014/15 U.S. wheat crop by 9 million bushels.
"Carryout stocks are high for all three commodities. Overall, it is neutral for wheat and soybeans," said Terry Reilly of Futures International.
The USDA lowered its forecast for China's 2014/15 corn crop by 3 million tonnes, to 214 million, but the shortfall was not expected to be a boon for imports, which were cut by 500,000 tonnes, to 2.5 million.
Global wheat consumption for 2014/15 was lowered by 1.4 million tonnes, due mainly to lower usage in Egypt, stemming in part from changes to its bread subsidy program. A 1 million tonne cut to Australia's wheat crop will result in smaller exports, USDA said. (Editing by Andrea Ricci, Matthew Lewis and Andrew Hay)