KANSAS CITY, Mo. — A veteran commodities economist called the U.S. Department of Agriculture’s crop production annual summary one of the most unusual January reports that he’s seen in decades.

“Whether it is due to the lower numbers of USDA staff that they have on now with many of them taking the buyout earlier this year or what, I don’t know what to attribute it to,” Arlan Suderman, StoneX chief commodities economist, said.

“But there were some significant surprises, even including adjustments to the previous marketing year that they usually don’t make at this time of year, not just ending stocks, but the size of the 2024 corn and soybean crops. Also, there was a significant increase in corn acreage in this report for the 2025 crop.”

Suderman hosted a market outlook after the USDA’s release of the crop production annual summary, world supply and demand estimates, quarterly grain stocks and winter wheat seedings reports Jan. 12.

Among the biggest surprises in the crop production report was the USDA increasing harvested corn acres by 1.3 million from the November to January estimates, while increasing planted acres by about 500,000. How and why?

Suderman: That is a very big January increase. With the Farm Service Agency acres, they got some more data in from the certification acres that increased a bit, but they pushed their actual acres for supply and demand estimates report even higher. Maybe that was to try to soften the blow of a higher yield on production. I don’t know, but it is what it is.

The bottom line is, that’s the total bushels that we have, and it’s a big crop — 17 billion bushel corn crop.

Obviously, in a major drought year, you have higher abandonment of planted acres. We did have a lot of widespread dryness, but not to the level of drought that increases abandonment.

And so what USDA is saying here that they had lower abandonment than normal. Whether we agree with that or not, I don’t want to get in that debate too much because this is essentially what the market will trade.

The stocks surveys show that the supplies were there. So, whether it was acreage or whether it was yield to adjust, the bottom line is the supplies. The stock survey shows that the supplies are there, so therefore that’s what the market’s going to trade.

I think we also need to understand that USDA is working with a lot fewer employes. They had a lot of people take the buyout earlier this year, particularly a lot of them who had many years of experience. I think that may have shown up in these numbers and how they were handled.

USDA reducing the soybean exports in January seems to be a strong signal. Can we start working with exports between 1.450 and 1.500 billion bushels?

Suderman: I have reduced my export number. Now, how far do you reduce it? That’s the question. I think China will buy the 12 million metric tons. I’m not sure logistics will allow them to import all 12 million.

If they do get all 12 million shipped in this current marketing year, that’s where I feel pretty good with my export number, which is about 25 million bushels less than USDA has it.

That is still subject to some refinement, depending on how big Brazil’s crop is and how much other business they take away from us with their cheap prices. But, for now, I feel good about that number.

If they don’t get it all shipped, then our ending stocks go even higher with exports dropping more. That’s going to be the primary risk there.

What is a fair value range for corn with the current U.S. ending stocks? Will the Latin America weather add some strength from that?

Suderman: When you look at historical national average cash grain prices, I’m a little bit lower than where USDA is at. They’re assuming some inflationary factor of the market trading at a higher price level than what it historically has at those levels.

I would be sub $4; USDA is trying to hold that $4 level. I still think we’re vulnerable to a marketing year average cash price somewhere just below $4. Obviously, that’s going to vary by region for the corn.

In Argentina, we still have above-average Normalized Difference Vegetative Index, or NDVI, score, but the dryness is trending more intense there. They have a very long planting season versus the U.S. We pollinate all the corn in a relatively short period of time, which leaves us more at risk.

In Argentina, they’ll pollinate the corn crop over several months, because they have that wide of a planting window starting to plant in November and finish planting in February or so.

So, that does hedge their risk a little bit, but certainly that risk is there when you look at the overall dryer pattern that we see in Argentina.

With Brazil, if you look at the analog years for sea surface temperatures, it would suggest they’re going to have good rainfall for production, so they could have a big crop there.

There’s risks right now for dryness, and this could all change, but right now the risk for dryness for Brazil appear to be relatively low for their winter corn growing season.

How low would prices have to go to get South America to stop expansion or reduce the acres?

Suderman: I frequently get the question from Brazil farmers, how low do prices have to go before the U.S. stops to expansion? It’s usually groups of Brazilian farmers that ask me that.

I say, farmers are optimists. They always believe that things are going to change and so they’re going to plant the crop. Farmers farm and they all smiled and said, yeah, you’re right. That’s what I anticipate there, as well.

Now, they may stop expanding, and then your question does address that. That will be a key. I think they’ve got their inputs are ready for this next year. I’m not sure this drop in prices reduces area planted for the winter corn crop this year.

If we go to $9 soybeans, I’m pulling numbers out of the air here, so don’t consider this a forecast, $9 soybeans and sub $4 corn for prolonged period through the summer, that might reduce next year’s area.

Right now, our customer surveys in Brazil are still suggesting modest increases for the current growing season.

Can we forget about the possibility of a reduction of corn and soybean yields estimates ahead? After the shutdown, it seems to be a done deal.

Suderman: USDA is sticking with the big crop story and even raised last year’s crops.

Do you think government would consider to pay for set-aside acres?

Suderman: I hope not, because we’ll just shift more acres to Brazil. It would appear to be a short-term solution, but it would create more longer-term problems.

We created much of this problem in Brazil with what we did in the early 2000s in paying for expansion and really getting the industry going in Brazil. I do not sense any support in Congress paying for set-aside acres, and if they did it would just shift more production to Brazil.

USDA also released is quarterly grain stocks report reflecting stocks stored in all position Dec. 1, 2025. What numbers stood out to you in that report?

Suderman: The wheat number came in at 1.675 billion bushels. That was higher than the average trade estimate of 1.626 billion. Wheat is up about 100 million bushels over levels a year ago.

Corn quarterly stocks of 13.282 billion bushels was higher than the average trade guess of 12.962 billion and a little lower than where we were at 13.369 billion. Corn quarterly stocks versus last year are up over 1.1 billion bushels.

Soybean quarterly stocks of 3.29 billion bushels was 40 million higher than the trade and about 41 million less than where we were at. Soybean stocks were also about 190 million bushels above where they were last year.

What do you think of the nation’s average corn yield, estimated by USDA at 186.5 bushels per acre?

Suderman: Many of you may remember the heat that I took on social media last July when people were asking, why are corn prices going down? And I said it’s because the funds have their yield models and they’re trading what those yield models are saying.

My yield model is lower than what some of the funds are that I’ve seen. My yield model was at 186.9 bushels per acre.

I don’t know if I believed we could grow that big a crop, but that’s what the model said and so I knew the funds were trading similar models. So, that’s why I posted that to say, that’s what the funds are trading and, lo and behold, we ended up that way.