USDA is projecting record soybean production and exports for the coming season, as well as larger U.S. corn and rice production. Meanwhile, smaller crops are projected for wheat and cotton.

USDA's Supply and Demand Estimates and Crop Production reports are the first forecasts of the year for new crop commodities and could change significantly, since spring planting is still under way.

U.S. soybean production is expected to rise 23 percent for 2004-05 to a record 2.965 billion bushels based on projected plantings and trend yields. Soybean supplies are projected to reach a record 3.085 billion bushels despite the lowest beginning stocks since 1977.

Ending stocks for 2004-05 are projected at 190 million bushels, up 75 million bushels from 2003-04, despite increases in crush and exports. Soybean exports are projected to increase to 1.08 billion bushels for 2004-05. Large U.S. soybean supplies combined with reduced South American supplies and exports this fall are expected to boost U.S. soybean exports to a record level in the new marketing year.

Global oilseed production for 2004-05 is projected at a record 378 million tons, up 42.2 million tons from 2003-04. Most of the gain will be from soybeans, with crops in the United States and South America projected to recover from weather, disease, and insect problems experienced in 2003-04.

Brazil's 2003-04 soybean crop was reduced 2.5 million tons to 53.5 million tons, reflecting the impact of dry weather on yields in the southern growing region. Argentina's soybean production was reduced to 34 million tons, down 1 million tons from last month, and below last year's record.

The U.S. season-average soybean price for 2004-05 is projected at $5.85 to $6.85 per bushel, compared with $7.65 per bushel in 2003-04. Soybean meal prices are forecast at $195 to $225 per short ton, compared with $275 per short ton for 2003-04. Soybean oil prices are also projected lower, at 25 to 29 cents per pound, compared with 32 cents per pound for 2003-04.

U.S. new crop cotton production is projected at 17.6 million bales, nearly 4 percent below the 2003-04 season, based on projected plantings and historical average abandonment and yields.

Domestic mill use is projected at 5.8 million bales, 8 percent below 2003-04, due to rising apparel imports. Exports are projected at 11.5 million bales, a reduction of 17 percent from this season's record, due to much higher foreign production. Ending stocks are forecast at 3.9 million bales, an increase of 300,000 bales from 2003-04. The forecast stocks-to-use ratio is 22.5 percent.

Meanwhile, world cotton production is forecast at 102.5 million bales, nearly 10 percent above 2003-04, due primarily to the effect of higher world prices on planted area. World consumption is projected to grow about 1 percent to 99 million bales. World stocks were raised nearly 12 percent from 2003-04 to 36.5 million bales.

The U.S. 2004-05 corn crop is projected at 10.425 billion bushels, 3 percent above last year's record. USDA forecasts gains in domestic use — largely due to increased use of corn for ethanol. U.S. corn exports are forecast higher, to 50 million bushels, largely because of less competition from China.

With use exceeding production, 2004-05 ending stocks of corn are projected to be down 65 million bushels. The projected price range for corn is $2.55 to $2.95 for 2004-05, compared with $2.45 to $2.55 for 2003-04.

USDA projects larger world production of corn, along with higher use and lower ending stocks.

U.S. rice production in 2004-05 is projected at 217.5 million hundredweight, 18.3 million hundredweight above 2003-04. Rice yield is projected at a record 6,721 pounds per acre, up 76 pounds per acre from 2003-04, due to the continued adoption of higher yielding long-grain rice varieties.

Long-grain rice production is projected at 162.5 million hundredweight, 13.5 million hundredweight above 2003-04, while combined medium- and short-grain rice production is projected at 55 million hundredweight, nearly 5 million hundredweight above 2003-04 and the largest crop since 2000-01.

Domestic and residual use for 2004-05 is projected at 118.1 million hundredweight. Exports are projected at 111 hundredweight, the second largest on record. Rough rice exports are projected at 38 million hundredweight.

Exports of milled and brown rice are projected at 73 million hundredweight. Ending stocks of 24.8 million hundredweight would be 2.3 million hundredweight above 2003-04.

U.S. rice prices are expected to remain firm because of tight global supplies and strong prices. The projected season-average price range for 2004-05 is $8.25 to $8.75 per hundredweight compared to $7.45 to $7.55 per hundredweight for 2003-04.

Global 2004-05 rice production is projected at 401.8 million tons, up nearly 11 million tons from 2003-04. World consumption is projected at a record 417.9 million tons, up 5 million tons from 2003-04. Ending stocks are expected to decline for the fifth straight year, to 69.4 million tons, 16.1 million tons below 2003-04, and the lowest since 1983-84. The global stocks-to-use ratio is projected at 16.6 percent, down from 20.7 percent in 2003-04, and the lowest since 1976-77.

Total U.S. wheat production is projected down 11 percent from 2003-04 to 2.080 billion bushels due to lower area and yields. Wheat feed and residual use is projected to decline by 25 million bushels. Projected exports of 975 million bushels are 195 million bushels below 2003-04.

U.S. ending stocks are projected down 27 million bushels from a year earlier, and remain relatively low at 499 million bushels. The projected price range for 2004-05 is $3.25 to $3.85 per bushel, compared with an estimated $3.40 for 2003-04.

The 2004-05 global wheat outlook is for further decline in stocks despite increased production.

e-mail: erobinson@primediabusiness.com.