What Farmers Need to Know Before the March WASDE Report

The March World Agricultural Supply and Demand Estimates (WASDE) report is due Tuesday, March 11. February’s WASDE report offered more good news to corn and soybean bulls in the way of smaller South American production. U.S. carryout was left unchanged for corn and soybeans and reduced slightly for wheat. Over the past several weeks, conditions in South America have stabilized or improved slightly, so we do not expect any substantial production adjustments in next week’s report.

Corn Market Expectations

U.S. corn carryout for 2024/2025 was left unchanged at 1.54 billion bushels on the February report. World ending stocks for the same marketing year were lowered from 293.34 million metric tons (mmt) in January to 290.3 million, due to lower production in Argentina and Brazil.

Demand for U.S. corn has remained firm, with export demand continuing to exceed the USDA’s projected pace. Total sales commitments are at 78.2% of the USDA’s current forecast for the 2024/2025 marketing year, compared to the five-year average of 70.2% by this point in the year. Export inspections are at 41.6% of the USDA’s current estimate, compared to the five-year average of 32.8%. Ethanol production remains strong as well, suggesting a final usage near 5.6 billion bushels versus the USDA’s current estimate of 5.5 billion.

Grain Market Insider thinks an increase in export demand and ethanol production is warranted. It’s possible U.S. ending stocks will be lowered by 25-50 million bushels on next week’s report. 

Soybean Market Outlook

U.S. ending stocks for 2024/2025 soybeans were left unchanged at 380 million bushels last month. World ending stocks were reduced from 128.37 mmt to 124.3 mmt, due to a smaller production forecast for Argentina.

Since then, the export pace for U.S. soybeans has slowed, which is normal for this time of year. Export commitments and inspections for 2024/2025 are still slightly ahead of the pace needed to meet the USDA’s goal. Soybean sales are at 88.9% of the USDA’s current projection, compared to the five-year average of 85.6%. Inspections are running about 2% ahead of the five-year average pace. Soybean crush for the month of January was better than expected at 213 million bushels. Overall crush is slightly ahead of the current forecast.

The bottom line: With exports moving at a pace only slightly better than the current forecast and slowing, combined with the recent trade developments, Grain Market Insider does not expect any adjustments to soybean ending stocks on the March report.

Considerations for the Wheat Market

The February crop report was an uneventful one for the wheat market. U.S. 2024/2025 ending stocks were adjusted slightly lower from 798 million bushels to 794 million. World ending stocks were also adjusted slightly lower from 258.82 mmt to 257.6 mmt. 

Export sales have remained steady since last month’s report. The current sales pace of 86.3% sold is slightly ahead of the five-year average of 86%. The current pace of inspections is lagging, however, at 65.8% of the current estimate compared to the five-year average of 67.5%. 

Grain Market Insider does not expect any material adjustments to supply and demand estimates next week.

Historical Patterns and Statistical Perspective

Based on data from 2000–2023, Grain Market Insider’s internal research indicates market volatility on March’s WASDE report day tends to be low for corn and soybeans, and in the middle for wheat. 

For corn, the report results in a negative market reaction 59% of the time. In terms of outright volatility, this report ranks near the bottom, with an average absolute change of 5¢. When examining upward or downward moves, the average positive net change on report day is 6¢, while the average negative net change is 5¢.

For soybeans, March ranks slightly lower in outright volatility than corn. The report has a 56% chance of triggering a positive market reaction. When the reaction is positive, the average bounce is 2¢, compared to an average decline of 12¢ if the reaction is negative.

For wheat, the report ranks in the middle in terms of volatility, with an average net change of 9¢. When broken out by positive versus negative reactions, it has the second-highest likelihood of a positive reaction of all 12 reports. Positive reactions average a 9¢ gain, while negative reactions yield a 9¢ loss.

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About the Author: Eric Fransen is the Director of TFM360 Market Analytics at Total Farm Marketing. Eric’s calm, confident, and reasonable approach to farm marketing has been a safe harbor to his clients and the Grain team alike since 2003, making him a welcome person to turn to in an often unsettled market. Eric enjoys breaking down and explaining complex concepts and strategies to farmers as he helps them make decisions to help improve their bottom lines.