Later this morning USDA comes out with its April World Agricultural Supply and Demand Estimates.
Sometimes these reports, at touchy times, can make markets erupt.
Sometimes they are non-events.
I’m getting the sense that most analytical folk out there think it will be mini-event, not entirely shrugged off, but unlikely to cause any great action. (Unless there’s some stupendous shock inside the numbers, of course)
That’s because just a few days ago USDA shocked the market in its stocks report by finding much higher corn stocks than anyone expected, which suggested that demand is getting killed and that there won’t be the kind of old-crop squeeze that many grains bulls had been hoping for.
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So the big numbers are already out, and WASDE will mostly just give us calculations on what those numbers will mean a few months in terms of ending stocks. So, today’s mostly a math day.
Here’s what a handful of analysts told me yesterday:
WINNIPEG BROKER KEN BALL OF PI FINANCIAL
What’s he expecting?
“Not much. We got the big news last week in the stocks report. There’s nothing they can really say that will change the situation.”
CHUCK PENNER, LEFTFIELD COMMODITY RESEARCH:
“I think there’s potential for more surprises, but mostly in how they account for (the stocks numbers).”
Depends if ending stocks are upped, or useage is calculated to rise.
“If they increase ending stocks, I think we’ll see another kick down in corn, beans and wheat.”
BRENNAN TURNER OF FARMLEAD.COM
In a Tweet response to my Tweeted question on what do analysts want to know:
“Where did all the corn come from? Where did those soybeans come from? Downgrade of S. American output. Winter wheat info.”
BRIAN VOTH OF AGRITREND MARKETING:
Another Twitter response:
“Same here on the corn and beans. Those will drive everything else, in my opinion.”
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So, there you have it. Modest expectations from most folks.
Now we can just wait to see that actual numbers.
I’ll be retweeting stuff from analysts once the report is out. I’ll be at the Manitoba Pork Council annual meeting, but thanks to modern miracle technology, I’ll be able to follow what the smart folks are saying about this. If you’re on Twitter, follow me @EdWhiteMarkets
