The USDA’s December World Agricultural Supply and Demand Estimates (WASDE) report projects U.S. corn ending stocks at 1.738 billion bushels. This is 200 million bushels lower than the November projection and much lower than the market expectation of 1.906 billion bushels.

The USDA predicts more corn will be used for ethanol, larger exports and lower ending stocks. Corn used to produce ethanol increased by 50 million bushels to a total of 5.5 billion bushels. In the quarter from September to November ethanol production was the highest since 2017. Corn exports have also increased by 150 million bushels.

Soybean ending stocks remain unchanged from last month at 470 million bushels. Wheat ending stocks were reduced more than the average trade expectation to 795 million bushels. This compares to the November estimate of 815 million bushels and the trade expectation of 814 million bushels.

Read more from the December WASDE report here.