Gulke: Any Good News in June 30 Report?
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While seemingly void of shock and awe, the much-anticipated revised USDA Grain Stocks and Planted Acreage reports did contain some good news.
— Corn stocks as of June 1 came in 110 million bushels (mb) below expectations. The corn number supports strong usage — or suggests last year’s yield was less than 186 bushels per acre. Regardless, this reduces 2026-27 carry-in supply by the equivalent of 600,000 acres of production.
— Corn planted acres were revised upward by 380,000, partially offsetting the supply decrease noted above.
— Soybean acres were unchanged at 85.40 million.
— Canola acres were up 600,000 versus last year, as the crop fares better in the Northern Plains than soybeans. Canada reported a similar trend, with Canadian producers believing they will play an instrumental role in supplying feedstocks to the U.S. biofuels industry.
— All-wheat acres were reduced by 1.1 million, which surprised the trade — but not this writer. Our Gulke Group Inc. client survey in early March was dead-on with the soybean and all-wheat numbers, though about 600,000 acres higher than USDA on corn. Overall, that’s about as good as it gets for outlook planning and keeping in sync with our tradition.
Interestingly, total planted acres were down about 2 million versus last year. History shows that in financially challenging times, some acres simply don’t get planted.
On-farm stocks — an important indicator of available supply — showed corn up 16% over last year, soybeans down 11% and wheat down 4% versus 2025. Off-farm stocks were up 12%, 16% and 11%, respectively. The fact that total corn stocks are up significantly is straightforward math: Carryout this year is roughly 600 mb more than on this date last year. No surprise there — media hype at best.
Factoring the new numbers into the 2026-27 supply and demand outlook — reducing carry-in stocks by 110 mb, adding 110 mb to Feed and Residual (assuming Tuesday’s reduction was attributable to increased F&R for 2025-26), increasing ethanol by 50 mb and exports by 35 mb — yields ending stocks of approximately 1.7 billion bushels (bb), versus USDA’s current projection of 1.96 bb. Not a dramatic change, but a move in the right direction.
Soybeans, on the other hand, could see ending stocks tighten to below 150 mb if China follows through on the 25 million metric tons referenced in the memorandum of understanding. USDA is clearly not willing to acknowledge that potential, nor is the trade in general, until the additional volume actually leaves U.S. shores. Or perhaps USDA is reluctant to publish anything optimistic for fear of fueling price appreciation. Until export sales are committed, speculation will persist — and prices to producers will soften in the process, to the detriment of net profit.
On the weather front, the most critical window for determining crop size and yield remains ahead. Acreage is fixed for now — subject to revision in September — but yield is the wild card, and we play the hand we’ve been dealt.
My anticipation of this report led me to exit hedges, moving from 100% hedged to less than 15% two weeks ago, while holding cash-forward sales placed six weeks ago at 40%-50%. Tuesday was a nail-biter going in, but sometimes patience pays. How the market behaves the rest of this week — and especially next week — will be governed by the new 8- to 14-day forecast. The short-term buy signals from two weeks ago continue to be supported by Tuesday’s report, though barely. That makes the strength shown Tuesday critical to establishing a new trend — if only sideways — until the July WASDE. In the meantime, a close below Tuesday’s lows would be needed to change my bias.
Jerry Gulke can be reached at (707) 365-0601 or by email at Jerry@gulkegroup.com
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