Complicating the picture has been the drought that has already cut into South American beans.

Soybeans were clearly the newsmaker in this April WASDE report. U.S. soybean ending stocks number was reduced by 25 million bushels to 250 million bushels. The decline was due to an increase in the expected amount of soybean crush and stronger U.S. exports to make up for the South American shortfalls.

On the world level, soybean ending stocks for 2011-12 are projected to decline to 55.52 million metric tons. The Argentina soybean crop estimate has been reduced by 257 million bushels from the November estimate and the Brazilian soybean crop has been reduced by 330 million bushels from the November estimate—again all due to the drought farmers in those nations worked through this growing season.

U.S. corn ending stocks for the 2011-12 marketing year were unchanged from the March report. Pre-report estimates were for a reduction in stocks based on the March 30 grain stocks report. Davis said that projected marketing year ending corn stocks of 801 million bushels is a 6.3 percent stocks-to-use ratio, or roughly a 23 day supply of corn available at the end of August.

Also related to corn, the WASDE report projects greater livestock feeding of wheat instead of corn, which will reduce the amount of corn used for that purpose. In addition, the 2012 corn crop is being planted earlier this year, so there is greater potential of the new-crop corn being harvested in southern states that could be fed in August. Davis said that “would provide some cushion for the tight 2011-12 corn balance sheet.”

At the world level, corn ending stocks for the 2011-12 marketing year will be the tightest since the 2006-07 marketing year with a stocks-to-use ratio of 14.2 percent, which was the tightest ending corn inventory in recent history, according to Davis.