December corn is in a strong uptrend, helped by the USDA's estimate of an 8% reduction in planted acres this spring and adverse weather conditions. Prices got hit like most commodities in the third week of March, but rebounded quickly and continued higher - a very strong sign (updated 5-7).

Fundamental Stats -

On April 9, 2008, the USDA reduced its estimate of 2007-2008 U.S. ending stocks from 1.438 to 1.283 billion bushels. That puts the 2008 ending stocks to use ratio at 10%, the lowest in four years. On the world scene, the USDA is looking for 2007-2008 ending stocks to fall from 108 to 103 million tons, or 13% of annual use. In 2007-2008, exports are expected to be up 18% and, so far, they are up 16% from a year ago.

On February 22, 2008, the USDA released early projections for 2008-2009. They expect 12.81 billion bushels of production to result in 1.243 billion bushels of ending stocks, the lowest in five years. Of the 13.0 billion bushels of total use they foresee, 4.1 billion bushels are expected to go into ethanol production, up from 3.2 billion bushels the previous year. On March 31st, the USDA estimated that 86.0 million acres of corn will be planted this spring, down 8% from last year and down from its projection of 90.0 million acres on February 22nd. As of May 4, 2008, 27% of the corn crop was planted, down from its five-year average of 59%.

The strong uptrend in November soybeans peaked in early March and prices appear to have found support at the 6-month moving average. The USDA is expecting planted acres to increase 18% and that is weighing on the market (updated 5-7).

Fundamental Stats -

On April 9, 2008, the USDA raised its estimate of 2007-2008 ending stocks from 140 to 160 million bushels, down from 574 million bushels in 2006-2007. The resulting 2008 ending stocks to use ratio is 5%, the lowest in four years. Worldwide, the USDA estimated that 2007-2008 ending stocks will drop from 63 to 49 million tons or 21% of annual use. Brazil and Argentina's soybean crops are only expected to increase slightly in 2008. In 2007-2008, the USDA expects exports to be down 4% and so far, they are down 3% from a year ago.

On February 22, 2008, the USDA said that they expect the U.S. to produce 2.95 billion bushels of soybeans in 2008-2009 and end the season with 169 million bushels, or 6% of annual use. On March 31st, the USDA said that it expects 74.8 million acres of soybeans to be planted in 2008, up 18% from a year ago and up from its projection of 71.0 million acres on February 22nd. As of May 4, 2008, 5% of the soybean crop was planted.

The strong uptrend in July wheat peaked on March 12th and is clearly over. Prices have been sliding lower since then with a new harvest coming soon. Over the past two weeks, the rate of selling has slowed and it looks like prices might have found support at $8.00 (updated 5-7).

Fundamental Stats -

On April 9, 2008, the USDA kept its estimate of 2007-2008 U.S. ending stocks at 242 million bushels, the lowest in 61 years. The result is a U.S. ending stocks to use ratio at 10%. Worldwide, the USDA is expecting 2007-2008 ending stocks to fall from 125 to 112 million tons, or 18% of annual use.

On February 22, 2008, the USDA predicted that the U.S. will have a 2.33 billion bushel wheat crop in 2008-2009. They expect the ending stocks to increase from 272 to 538 million bushels, or 25% of annual use. On March 31st, the USDA said that it expects 63.8 million acres of wheat to be planted in 2008, up 6% from a year ago and close to its projection of 64.0 million acres on February 22nd.

2007-2008 wheat exports are expected to be up 40% and so far, they are up 46% from the previous year. As of May 4, 2008, the USDA said that 47% of the winter wheat crop was rated good to excellent, down from 57% a year ago. Also, 58% of the spring wheat was planted, down from its five-year average of 62%.

After a quick rise in February and a quick drop in March, July cotton prices have settled down with cotton acres expected to be 13% fewer this spring. Prices dipped below the 6-month moving average, but may have found support at 70 cents ahead of Friday's USDA report (updated 5-6).

Fundamental Stats -

On April 9, 2008, the USDA increased its estimate of 2007-2008 U.S. ending stocks from 9.4 to 9.7 million bales. The 2008 ending stocks to use ratio is 51%, a slight improvement from the previous year, but still on the high end. Worldwide, the ending stocks estimate is 60 million bales, or 48% of annual use, down from 61 million bales the previous year. In 2007-2008, the USDA expects exports to be up 11%, but so far, they are up 25%.

On February 22, 2008, the USDA released its estimate for the upcoming 2008-2009 season. They expect 15.0 million bales of production and ending stocks of 3.7 million bales, the lowest in five years (Note: the March 11 USDA report likely means that these estimates will also be increased). On March 31st, the USDA said that it expects 9.4 million acres of cotton to be planted, down 13% from a year ago.

U.S. cotton farmers are in a tough position. There is growing political pressure from the World Trade Organization to cut subsidies, but so far the U.S. government has refused. Also, trade relations with China are contentious and without China, U.S. growers do not have much of a market for their cotton.

U.S. mill use in February improved from an annual rate of 4.70 to 4.71 million bales. For all of 2007, U.S. mill use was down 12%. As of May 4, 2008, 26% of the cotton crop was planted, down from a five-year average of 32%.