The cash market is still in shock from USDA’s report on Friday & we must admit we were wrong about the stocks & acreage report as well. There is a large range in how analyst have broken out the stocks by class on this report, & we’re still making adjustments ourselves by class. USDA released their details in their by-class usage this PM, only making change to the feed/residual & didn’t touch the food usage. USDA will get more flour information & make possible changes in their February report. The acreage number was perhaps the biggest surprise & is still being debated, but someone mentioned when you have wheat area at 100 year low, how much lower can it go. USDA will come out with estimates on production with their February Outlook report for new crop.
The larger stocks & winter wheat area now has cash traders & shippers guessing how much old crop wheat needs to move prior to harvest, but the drop in futures is not encouraging growers to sell & poor crop condition ratings has shippers willing to wait to see how the crop looks coming out of dormancy.
