Agri-reaction June 2016:Under the weather

　　Soybean stock to use is estimated at 20% (vs 21% in May), still belowthe 10-year average of 24% as projected stocks declined 2m tonsdriven by poor weather conditions (hot and dry) in Brazil’s Center-Westand Northeast regions. Production expectations for 2016/17 are down0.5m to 324m tons largely driven by Brazil. Wheat stock to use isestimated at 36% vs the 10-year average of 28%. Global production for2016/17 is forecast to increase nearly 4m to 731m tons (second only to2015/16 record) driven by increased production expectations in the EU,Russia and US which should more than offset reductions in Brazil andMexico. Ending stocks for 2016/17 are projected a record high of 258mtons. Corn stock to use is estimated at 20.4%, above the 10-yearaverage of 17.3%. Global corn production for 2016/17 is forecast toremain relatively stable, while ending stocks forecast down 1.9m tons to205m tons as lower stocks in the US offset increases in foreign stocks.

　　Cotton stock to use of 86% remains above the 10-year average of 69%driven by previous Chinese stock-piling. The global cotton ending stockestimate for 2016/17 was decreased by c2m bales largely due to lowerbeginning and ending stocks in China driven by lower expectedproduction.