USDA Releases January WASDE Report: Key Insights for Grain Markets

The eagerly awaited January USDA World Agricultural Supply and Demand Estimates (WASDE) report is set to be released on Monday, January 12. Historically, this report marks significant volatility for corn, soybeans, and wheat markets due to substantial adjustments in production and demand forecasts. In addition, a USDA Grain Stocks report will be released simultaneously, adding to the market’s dynamics.

Corn Market Expectations

The January WASDE will provide the final production estimate for the 2025 corn crop, currently pegged at 16.752 billion bushels with a yield estimate of 186 bushels per acre (bpa). However, anecdotal evidence suggests that this yield estimate may be overly optimistic. On average, the January report tends to adjust yields downward by approximately 1.7 bpa, with historical adjustments reaching as high as 3.8 bpa in previous years.

Export demand for corn remains robust. As of January 5, reports indicate total inspections at 34.3% of the USDA’s forecast, significantly higher than the five-year average of 21.4% for this time of year. Export commitments are also 8% above the five-year average, indicating strong market activity.

Furthermore, corn use for ethanol production for the 2025/2026 crop year has shown promising growth, suggesting that final usage could surpass the USDA’s estimate of 5.6 billion bushels. Grain Market Insider anticipates that a decrease in production may be counterbalanced by lower feed demand while export demand continues to rise, with ending stocks expected to remain stable or slightly lower.

Soybean Market Outlook

The January WASDE will also include the final production estimate for the 2025 soybean crop, currently projected at 4.253 billion bushels based on a yield of 53 bpa. Unlike corn, Grain Market Insider has no clear bias regarding potential production adjustments for soybeans.

However, soybean export shipment rates have been sluggish, with inspections showing that only 36.9% of the USDA’s forecast has been shipped as of December 9, compared to a historical average of 55.5%. Additionally, while 62.2% of export commitments through December 25 have been met, it remains below the five-year average of 79%.

The USDA has reported that 221 million bushels of soybeans were crushed in November, surpassing last year’s figures and marking a record for that month. Importantly, the current pace for the 2025/2026 marketing year appears to be on track to meet or slightly exceed the USDA’s forecast of 2.555 billion bushels. Overall, Grain Market Insider anticipates a decrease in exports but a potential increase in processing activity, which may lead to higher ending stocks.

Wheat Market Considerations

For wheat, the USDA indicates a positive export trend, with export inspections at 62.3% of the current estimate against a five-year average of 54.9%. Export commitments through December 25 have reached 81.7% of the USDA’s current estimate, above the typical average.

Grain Market Insider expects to see an uptick in export demand in the January WASDE report, which could lead to a reduction in ending stocks.

Historical Analysis and Volatility Insights

Data from 2000 to 2023 indicates that market volatility on the January WASDE report day is typically above average for corn, soybeans, and wheat. Specifically, there is a 62% probability of a positive market reaction for corn, with historical data showing an average price change of 13¢. Meanwhile, soybeans demonstrate a 57% positive reaction probability, with an average volatility change of 24¢.

Wheat shows the highest likelihood of a positive reaction at 67%, accompanied by an average price change of 16¢. When the report is met positively, the average rally recorded is 16¢, while negative reactions see an average decline of 26¢.

Disclaimer: The data shared herein is deemed reliable but cannot be guaranteed. Any individuals acting on this information do so at their own risk. Commodity trading may not be suitable for all recipients, and futures trading involves significant risks of loss. It is essential to evaluate such trading strategies in light of your financial circumstances. No assurances are made that strategy or analysis will yield successful outcomes.

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About the Author: Eric Fransen is the Director of TFM360 Market Analytics at Total Farm Marketing. With a calm and analytical approach to farm marketing, Eric has been a guiding resource since 2007, helping farmers navigate complex market landscapes and improve their profit margins.

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