Economist breaks down May WASDE report

INDIANAPOLIS — The U.S. Department of Agriculture predicts soybean ending stocks will decrease 16%, or 55 million bushels less than 2024, and corn ending stocks will increase 27%, or 385 million bushels from 2024.

Todd Davis, Indiana Farm Bureau’s chief economist, analyzed the May World Agricultural Supply and Demand Estimates report.

“While the report was not as pessimistic as feared, the increase in corn ending stocks will be a headwind limiting price potential,” he said.

“USDA is currently assuming weather that would produce record yields, so any weather event that reduces yield potential would reduce supply and potentially reduce ending stocks.

“But it’s always important to keep in mind that these predictions are preliminary. There’s still a lot of room for Mother Nature to fiddle with those numbers.”

Trade or tariff news could easily disrupt the market, Davis said.

“After the first trade dispute with China, they started importing a smaller share of U.S. soybeans and instead increased imports from Brazil,” he said.

“There are a lot of reasons why that’s the case, but in general, markets crave certainty, and we just haven’t had a lot of certainty when it comes to trade this year.”

Summary

• USDA estimates the 2025 corn crop to increase by 953 million bushels, or 6.4%, from 2024 due to a 4.5 million-acre increase in harvested area combined with an assumed record yield of 181 bushels per acre.

• Corn supply is projected to increase by 605 million bushels, or 3.6%, from last year, with estimated use increasing by 220 million bushels, or 1.4%. As a result, 2025 corn stocks are estimated to increase by 385 million bushels, or 27%, from 2024.

• USDA estimates the 2025 soybean crop to decrease slightly — 0.6% — due to 3.9% fewer harvested acres combined with an assumed record soybean yield of 52.5 bushels.

• Soybean supply is estimated to decline by 0.5%, with use estimated 0.7% higher than in 2024. The result is an estimated 16% reduction in ending soybean stocks from last year.

• USDA estimates the average corn and soybean farm prices for the 2025 crops at $4.20 and $10.25, respectively.