Acreage and Grain Stocks reports move markets

By Doug Tenney, Leist Mercantile

Today was a huge report by USDA. Most certainly producers and traders are viewing it with much trepidation. New this month we are seeing trading at the CME in live mode while the USDA reports are released. The first test was earlier this month with the supply and demand report. Many expected trading to be brisk with a huge range within minutes of the 8:30 release. In the past 10 days many have suggested that limit up or limit down for corn was a huge possibility.

The report this morning was an acres report and grain stocks as of June 1. Corn acres were estimated at 96.4 million acres while soybean acres were pegged at 76.1 million acres.

June 1st corn stocks were estimated to be 3.138 billion bushels, soybean stocks were 667 million bushels.

In trading at 8:40 December corn was up 19 cents with November soybeans up 14 cents.

Prior to the report traders had estimated U.S. corn acres would be 96.09 million acres. This compares to the March 30 estimate of 95.86 million acres. Last year corn acres were 91.92 million acres. Trade estimates for soybean acres were 75.51 million acres while the March 30 estimate was 73.9 million acres. In 2011 the U.S. planted 74.98 million acres to soybeans.

This report will set the market tone in early trading on Friday. Then the market will quickly return to the weather and any pending rain events moving across the US Midwest.

Past history indicates the quarterly grain stocks reports are extremely violent and volatile for corn with at least five report days yielding a limit move up or down in the past two years.

In trading at 8:15 am, corn was up 6 cents, soybeans were up 13 cents, with wheat up 7 cents.

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