Traders weren’t looking for a reduction in soybean output with the majority of the crop (87%) in the bin nationwide as of Nov. 7, but that’s exactly what USDA found in its latest crop production report.

The Ag Department trimmed its estimate of U.S. soybean production by 23 million bushels to 4.42 billion bushels in its monthly report on Tuesday, down less than 1% from its previous forecast.

“That was enough to get the trade shook up a bit,” Karl Setzer, AgriVisor commodity risk analyst, told the RFD Radio Network.

“We didn’t see any earth-shattering numbers,” he continued. “But, you look at the market and you’d think this was one of the most bullish reports we’ve seen in a long time, especially looking at soybeans.”

The shorter soybean crop resulted from a cut in yield estimates, with a national average now pegged at 51.2 bushels per acre, down .3 of a bushel from last month but up .2 of a bushel from 2020. The area for harvest remains unchanged from last month at 86.4 million acres.

“Soybeans were a bit of a surprise. We saw USDA reduce the size of the U.S. crop,” Brian Basting, market analyst with Advance Trading, said during a teleconference hosted by the Minneapolis Grain Exchange.

However, USDA also trimmed its estimate of soybean exports by 40 million bushels, from 2.09 billion to 2.05 billion bushels.

“That was linked to a smaller import forecast for China,” Basting said. “China is a big wildcard moving forward.”

Ending stocks of soybeans subsequently increased 20 million bushels to a total of 340 million.

The season average price estimate slipped by a quarter to $12.10 per bushel.

Corn estimates went in the other direction with production up 43 million bushels from last month, to 15.06 billion bushels nationwide, and ending stocks down 7 million to 1.49 billion bushels.

The boost in corn production resulted from a half-bushel bump in the yield forecast, now pegged at 177 bushels per acre nationwide.

The area harvested for grain remains unchanged from last month at 85.1 million acres.

But, carryout slipped as USDA raised the estimate of corn used for ethanol by 50 million bushels compared to last month.

Overall, corn used for ethanol has increased by 225 million bushels for the year compared to last year.

“We’re seeing exceptional ethanol margins at the moment,” Basting said.

USDA left the season average price estimate of corn unchanged from last month at $5.45 per bushel. However, it raised the price forecast by 20 cents for wheat to an average of $6.90 per bushel.

Ending stocks of wheat increased 3 million bushels, to a total of 583 million, but it still represents the lowest stock level since 2007/08, USDA reported.

Meanwhile, USDA left its national sorghum yield estimate unchanged from a month ago at 72.3 bushels per acre, down from 73.2 last year.

Looking ahead, USDA forecast a record soybean crop in Brazil and a shift to more corn production and less bean output in Argentina.