It’s hard to be optimistic at present. I was half thinking it may have turned out to be a sell the rumor, buy the fact type of WASDE response, but it appears to be a sell the rumor / sell the fact / sell everything kind of response. Grains were hit hard, apart from corn. The trade estimate for US corn stocks prior to the release was actually much higher than the WASDE number, actually 9.2% higher, that’s a significant departure from the report. Yet Chicago corn only managed a gain of a measly 4c/bu (AUD$2.32/t) in the December 2024 contract. The fact that managed money hold a record short in both Chicago corn and soybeans may have a little to do with this lack of reaction.

Looking into the report with a focus on wheat, we see the biggest hurdle going forward will be the big increase in world ending stocks. At 257.24mt, it may still be lower than last years 260.99mt but it is up from 252.77mt last month, and well above the trade expectation of a slight reduction on last months number.
Drilling down into the 2024-25 wheat numbers shows an increase of 1.43mt in world wheat carry in, +5.44mt in production to 796.19mt, and a 4.97mt increase in world carry out, yep, all the bad things. An increase of 3.64mt in US wheat production, an increase of 500kt to the Argie crop ??, and a 1mt increase to the Canadian crop, were not countered by the 500kt reduction to the EU crop.
An increase in carry in and carry out to the major importers numbers wasn’t much help either. Russian numbers were all but unchanged apart from a 1mt reduction in carry in, this rolled through to a 1mt reduction in their carry out number, production, consumption and exports there left unchanged.
Chinese carry in was increased 1mt, imports were increased 1mt, thus carry out was increased 2mt.
The more I look at the this report the lazier it looks. The trade will go about proofing the report over the next few days, no doubt their position will determine how much truth they publicly find in the report. With the funds holding a massive net short, my guess is they’ll think it’s pretty much on the money.