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CHICAGO, Jan 10 (Reuters) - The U.S. Agriculture Department on Friday raised its estimate of domestic corn and soybean production despite adverse weather throughout the fall that had been expected to curtail yields.
The government also said winter wheat plantings fell to 30.804 million acres, the lowest since 1909.
U.S. corn production for the 2019/20 marketing year came in at 13.692 billion bushels, based on an average yield of 168.0 bushels per acre, USDA said in a monthly report. Soybean production was 3.558 billion bushels, with average yields of 47.4 bushels per acre.
“The market should be disappointed about the production number for both corn and soybeans - yields going higher - not many people were expecting that,” said Ted Seifried, chief strategist with brokerage Zaner Group in Chicago. “That was a little bit of a disappointment for the trade.”
The bigger-than-expected harvests are another blow to a U.S. market struggling with weak demand amid a U.S-China trade war.
At the Chicago Board of Trade, corn, wheat and soybean futures sank to session lows after the report was released but quickly recovered.
Analysts had been expecting corn production of 13.513 billion bushels and soybean production of 3.512 billion bushels, based on the average of estimates given in a Reuters poll. Analyst had forecast corn yields at 166.2 bushels per acre and soybean yields at 46.6 bushels per acre.
Corn and soybean harvests were down sharply from a year earlier.
USDA plans to re-survey farmers in Michigan, Minnesota, North Dakota, South Dakota and Wisconsin as the bad fall weather prevented growers from finishing harvest. The January report is typically the government’s final look at production for the current marketing year but USDA said the re-survey may cause it to revise its harvest estimates for corn and soybeans.
The government’s closely watched quarterly stocks report showed that supplies of corn, soybeans and wheat were down sharply from a year ago.
As of Dec. 1, stocks of corn stood at 11.389 billion bushels, down from 11.937 billion bushels in December 2018. Soybean stocks dropped to 3.252 billion bushels from 3.746 billion bushels. Wheat stocks were 1.834 billion bushels, down from 2.009 billion bushels.
On the demand side, the government cut its forecast for 2019/20 corn exports to 1.775 billion bushels from 1.850 billion bushels but raised its estimate for corn used in the feed and residual category to 5.525 billion bushels from 5.275 billion bushels. (Reporting by Mark Weinraub; Editing by David Gregorio)
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