Oil report

UPDATE 1-U.S. corn, soy stocks fall as exports rise, government report shows

(Adds details, analyst comment, price reaction)

CHICAGO, Sept 30 (Reuters) - American soybean and corn stockpiles were smaller than expected as China stepped up its purchases of U.S. supplies during the summer, the U.S. government said on Wednesday.

Corn supplies dropped by 3.024 billion bushels and soybean supplies fell by 858 million bushels during the three months ended Sept. 1, the second-biggest summer drawdowns ever for both commodities, according to the U.S. Agriculture Department’s quarterly stocks report.

The September stocks report is frequently questioned as traders wait for specifics from the monthly supply and demand report.

“There’s normally a lot of gray in the September report, and perhaps this year some of that is being amplified by the amount of grain in transit in the export market,” said Brian Basting, economist for Illinois-based broker Advance Trading.

The report, which also showed that wheat stocks were the smallest in five years, sparked a rally in the futures market. Chicago Board of Trade corn futures jumped 4.6% to their highest since March 6. Wheat gained 6.1%, topping out at a six-month high, and soybeans rose 3.7%.

USDA said that soybean stocks as of Sept. 1 stood at 523 million bushels, according to USDA’s quarterly stocks report. Corn stocks were 1.995 billion bushels and wheat stocks were 2.159 billion bushels.

“Undeniably bullish all around,” said Charlie Sernatinger, global head of grain futures at ED&F Man Capital. “The corn stocks number was a true shocker, and turns things around big time.”

Analysts had been expecting corn stocks of 2.250 billion bushels, wheat stocks of 2.240 billion bushels and soybean stocks of 576 million bushels, according to the average of estimates in a Reuters poll.

USDA also trimmed its forecast of the 2020/21 all-wheat harvest to 1.826 billion bushels, down 12 million bushels from its August outlook. It revised its estimate of the 2019 corn crop to 13.620 billion bushels from 13.617 billion bushels. (Additional reporting by Julie Ingwersen and P.J. Huffstutter Editing by Paul Simao)