On Tuesday, March 10, USDA will touch up its old-crop balance sheets, but it remains to be seen how much fanfare the new World Agricultural Supply and Demand Estimates (WASDE) report will receive with markets rallying on the onset of war in the Middle East and the more pivotal quarterly Grain Stocks and Prospective Plantings report due out in just a few weeks.

USDA will release its WASDE and monthly Crop Production reports at 11 a.m. Central Daylight Time on Tuesday.

CORN

It took almost two months, but corn futures have finally climbed out of the hole left by the bearish January WASDE, with May futures now trading at calendar-year highs -- 10-month highs to be exact, if looking at most-active futures. Corn traders may be pricing in an anticipated decline in corn area for 2026, above and beyond what was outlined in the February USDA Ag Outlook Forum. However, Tuesday's WASDE will keep the focus with old-crop balance sheets, and in that regard, traders may be quick to look ahead to what feels like a much more pivotal report at the end of the month when USDA releases the 2026 Prospective Plantings.

As for U.S. supply and demand, the Dow Jones survey of 16 firms resulted in an average trade estimate of 2.155 billion bushels (bb) of corn ending stocks in Tuesday's report. This would be up 28 million bushels (mb) from the February WASDE. The export program will again be the most likely candidate for a demand increase, with the commitments pace still running 31% ahead of the same point in 2025 and USDA, as of the February report, only forecasting a 15% year-over-year increase at 3.3 bb. That being said, other demand categories such as feed, residual, and ethanol are concerning. But it also may be too early for USDA to be comfortable with large adjustments, especially ahead of a Grain Stocks report at the end of the month. The Grains Stocks reports serve as the cornerstones of USDA balance sheets. In that respect, I would not be surprised to see USDA make very minimal changes and keep ending stocks at a seven-year high and north of 2.1 bb.

On the world balance sheet, Tuesday's data will offer the most accurate view to date of production in South America, with first-crop corn harvest underway in Brazil and Argentina. In terms of Brazil, most of the production comes via the safrinha crop in June and July, but first-crop yield reports have been good, which may be enough to warrant a revision higher. The Dow Jones survey predicts 132.3 million metric tons (mmt), which would be up 1.3 mmt from the February forecast. In Argentina, after a very hot and dry January, rainfall was much improved in February and may have preserved some yield potential for late-planted crops. Harvest is only 7% complete as of this week, according to the Buenos Aires Grain Exchange, and USDA is already 4 mmt lower on its estimate at 53 mmt. Since harvest is so early, USDA may opt to wait and make adjustments in April with more results to inform its decision. Time will tell, but the Dow Jones survey agrees with an average estimate of 52.9 mmt.

SOYBEANS

The spike in crude oil and diesel futures has been felt directly in the soybean oil market, as the May contract has not traded lower since Feb. 20. As a result, soybean futures have followed higher, with May futures breaking over $12 per bushel, the first time that has happened for the most-active soybean contract since early June 2024. The rally is heating up despite some warning signs on a fundamental level as we head into the 2026 planting season.

Regarding soybean demand, export sales have notably slumped to begin 2026, as Brazil's harvest is in full swing and carrying a sharp price advantage to the U.S. currently. Traders remain optimistic that upcoming meetings between U.S. and Chinese officials -- and, of course, the marquee summit between Presidents Donald Trump and Xi Jinping -- will result in a prolonged trade agreement. For Tuesday, it is unlikely to me that there will be any sweeping changes to the U.S. soybean balance sheet, with export commitments running 18% behind a year ago and USDA forecasting a 16% decrease. I'd argue that the crush program could be revised higher and toward 2.6 bb, especially with the rampant rise in oil prices improving margins at the processor level. The average trade guess, according to the Dow Jones survey, is for 343 mb of soybean ending stocks, down from 350 mb, and a reasonable expectation for what I expect to be a neutral report overall.

In the world market, of course South America will get most of the attention on Tuesday. Harvest in Brazil is at a peak currently, and thus far, yield reports are very good. The main driver of what will likely be another record crop, however, is another expansion in plantings last fall. There are some reports of yield variability in the southern growing areas, however, and this is likely driving the 179.3-mmt average guess in the Dow Jones survey. That would be down 700,000 metric tons (mt) from February but still a record. In Argentina, soybean harvest is yet to start, with March being a crucial month for pod fill. Until more is known on how crop development finishes, I expect USDA to be conservative and near February's estimate of 48.5 mmt. For the world as a whole, analysts expect soybean stocks to hold near 125 mmt.

WHEAT

As is the case with corn and soybeans, wheat futures have accelerated their rally through this week, breaking above $6 on Kansas City futures for the first time since early 2025. Again, however, most of the bullish fundamental talking points are to do with widespread drought across U.S. winter wheat areas and mixed conditions heading into the spring green up. And for the time being, old-crop fundamentals will likely remain on the bearish end of the spectrum. As a result, I question the market-moving potential of Tuesday's report, as the current rally does not seem heavily rooted in wheat supply and demand ideas.

On the U.S. balance sheet, analysts are expecting a moderate decline in wheat stocks to 923 mb, from 931 mb in the February report. There may still be some room in exports, but that bullish argument has faded quickly through the past two months, as world competition has increased, and U.S. commitment pace has dwindled to a 14% year-over-year lead. USDA is still forecasting a 9% year-over-year increase in wheat exports. I expect USDA will be minimal in its alterations for this report, with the March 1 Grain Stocks report due out at the end of the month.

As for world wheat, the old-crop balance sheet is unlikely to feature many drastic changes, with no major crops being harvested. And even so, USDA will not release a new-crop 2026-27 balance sheet until the May WASDE. If the world stocks estimate in the Dow Jones survey of 277.3 mmt (277.5 mmt in February) proves accurate, that will still be the largest world wheat inventory in five years. It will be interesting to see how traders react to this fundamental reminder given the drastic risk-on rally through February and early March.

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Join us for DTN's post-report webinar at 12:30 p.m. CDT on Tuesday, March 10, as we discuss USDA's new estimates considering recent market events. Questions are welcome, and registrants will receive a replay link for viewing at their convenience. Register here for Tuesday's USDA March WASDE webinar: https://www.dtn.com/….

Rhett Montgomery can be reached at rhett.montgomery@dtn.com

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