Soft commodities and related agriculture exchange traded funds continued their rally Monday on lower U.S. inventories, with corn supply at its lowest since 1995.
U.S. corn supplies are diminishing at their fastest in 17 years and the lower prices have fueled demand from livestock producers beyond government projections, reports Jeff Wilson for Bloomberg.
On the supply side, the U.S. Department of Agriculture revealed that corn inventories on Dec. 1 were 8.03 billion bushels, or 17% lower year-over-year, compared to the average analyst expectation of 8.219 billion, Bloomberg reports. Wheat reserves on May 31 will be 716 million bushels, or 5% lower from December estimates, compared to the average analyst estimates of 741 million. Soybean inventories were 1.966 billion bushels, less than analyst projections and the lowest level since 2003.
Corn futures were up 2.0% Monday, wheat was 2.0% higher and soybean increased 2.6%.
USDA data revealed that lower quarterly corn stockpiles could translate to a further drop in inventories to 602 million bushels, the lowest since 1996, before the 2013 harvest.