May WASDE Report Due Out Later This WeekPosted 05/07/2019 8:57AM CT |
Many experts are bearish on corn as we near the release of the WASDE report on May 10th. Previous reports in the months of March and April showed noticeable demand issues on the balance sheet, and Rich Nelson, Chief Analyst at Allendale believes we will see another cut on old crop demand, roughly around 75 million bushels in feed, he predicts. The problems only get bigger from there as another cut in corn for ethanol is expected too. When we add all the numbers together, we are looking a demand decrease in roughly 275 million bushels over the course of March and April. In addition to this decreased demand in corn, we are about to have an increase in supply. According to the prospective plantings report, there is about 97.7 million acres of new corn crop that will be added to the supply. If basic economy 101 taught us anything it’s that a decrease in demand and increase in supply is not good for prices, they will drop.
When asked about his thoughts on the bearish outlook for grains, Hightower Analyst, Matt Connelly said “The USDA is likely to address slow pace of U.S. soybean exports in Thursday’s report. They could lower their 2018/19 forecast by 100 million bushels.”
Matt’s prediction will remain to be seen, but we will anxiously await the official report to come out May 10th, but we are expecting the report to reflect a bearish mindset.
Corn May ’19 Daily Chart