Pro Farmer Editors

Note: Revised October global projections for coarse grains and oilseeds shown in this report for October were not published in the abbreviated October 28, 2008, World Agricultural Supply and Demand Estimates (WASDE) report. October projections in today's report reflect the U.S. area and production forecasts for corn, sorghum, soybeans, sunflowerseed, and canola issued by the National Agricultural Statistics Service (NASS) in the corrected Crop Production report released on October 28, 2008. Month-to-month comparisons in today's report are based on the revised data.

WHEAT: U.S. wheat supply and use projections are mostly unchanged this month with only a minor adjustment to seed use and shifts among classes on imports and exports. Seed use is lowered 2 million bushels reflecting early indications that 2009 winter wheat seedings will be lower than previously expected. The lateness of this year's fall row crop harvest has limited planting opportunities for both soft red and hard red winter wheat. By-class changes to wheat imports and exports are made to reflect the pace of shipments to date. The all wheat season-average farm price is projected at $6.55 to $7.15 per bushel, down on both ends of the range from last month's $6.60 to $7.40 per bushel. Price prospects for the remainder of the marketing year are dampened by rising world supplies and continued declines in futures and cash prices.

Global 2008/09 wheat production is projected at a record 682.4 million tons, up 2.2 million from last month. Increases for EU- 27 and Russia more than offset reductions for Argentina, Australia, and China. EU-27 production is raised 3.4 million tons. Production is raised 2.0 million tons for Russia as harvest results confirm higher yields. Argentina production is lowered 1.0 million tons as persistent early season dryness limited crop development and reduced yield potential more than previously expected. Australia production is reduced 1.5 million tons as dryness continued through October in the southern growing areas reducing expected yields and harvested area. Partly offsetting were timely October rains in Western Australia that supported crop heading and grain fill. Production is lowered 1.0 million tons for China as 2008/09 area and yield adjustments are made in line with revisions to 2006/07 and 2007/08. Recently released estimates by China's National Bureau of Statistics raised 2006/07 and 2007/08 area and lowered 2007/08 production, reducing yields in both years. Afghanistan production estimates for 2006/07 and 2007/08 are also revised lower this month. World wheat imports and exports for 2008/09 are both raised this month. Imports are raised 0.5 million tons for Pakistan and increased 0.7 million tons for neighboring Afghanistan. Pakistan exports are raised 1.4 million tons reflecting higher expected border trade in wheat flour especially with Afghanistan as that country struggles to meet its food needs with this year's drought-reduced crop. Exports are increased 1.0 million tons for EU-27 with higher production and larger supplies. Partly offsetting are export reductions of 1.2 million tons for Argentina and 0.5 million tons for Australia on lower production and reduced supplies in both countries. World wheat consumption is raised 0.9 million tons for 2008/09 reflecting higher expected consumption for Afghanistan and Russia. Record production in Russia is expected to strain storage and handling capacity, boosting product and quality losses and adding to domestic disappearance. Global ending stocks for 2008/09 are raised 0.8 million tons this month with increases for EU-27 and Russia mostly offset by reductions for Australia, China, and Pakistan.

COARSE GRAINS: U.S. feed grain supplies for 2008/09 are projected lower as compared with last month's revised forecasts. The November Crop Production report lowers forecast U.S. corn production 13 million bushels. Corn exports are lowered 50 million bushels reflecting slower export sales and shipments and increased foreign competition. Ending stocks are raised 36 million bushels. The season-average farm price is projected at $4.00 to $4.80 per bushel, down on each end of the range from the previous $4.25 to $5.25 per bushel. Declines in futures and cash prices continue to undermine prospects for the 2008/09 season-average price received by producers. Rising world coarse grain supplies and reduced prospects for global feeding are also expected to pressure U.S. feed grain prices. Corn supply and use estimates for 2007/08 are revised this month. Imports are raised 2 million bushels and exports are raised 1 million bushels based on August trade data from the U.S. Bureau of Census. Ethanol corn use is raised 26 million bushels on higher-than-expected August ethanol production reported by the Energy Information Administration. Feed and residual use is lowered 25 million bushels. U.S. sorghum production for 2008/09 is forecast 7 million bushels lower this month. Feed and residual use is lowered 5 million bushels with the reduction in supplies. Ending stocks are projected 2 million bushels lower than in the previous forecast. The season-average farm price is projected at $3.40 to $4.20 per bushel, down from $3.70 to $4.70 per bushel. Price projections are also lowered for barley and oats, but by lesser amounts.

Global coarse grain supplies are projected 5.6 million tons higher this month with beginning stocks raised 4.1 million tons and production raised 1.5 million tons. Much of the increase in beginning stocks reflects reduced 2007/08 corn feed use and exports for Brazil. Most of the increase in production is from higher 2008/09 coarse grain production in EU-27 and FSU-12. Global corn production is raised 0.3 million tons with increases for EU-27, Russia, and Ukraine more than offsetting reductions for Argentina and the United States. EU-27 coarse grain production is raised 2.5 million tons with increases for barley, mixed grains, rye, corn, and oats. Russia corn and barley production are raised 0.7 million tons and 0.5 million tons, respectively, based on harvest results. Argentina corn production is lowered 1.0 million tons on lower expected harvested area as lack of timely rainfall reduced plantings. Argentina barley production is lowered 0.4 million tons as drought, frost, and hail damage reduce expected harvested area and yields. Barley production is also lowered 1.0 million tons for Australia as dryness across southeastern growing areas reduce area and yield prospects. World coarse grain imports and exports for 2008/09 are nearly unchanged this month. Global coarse grain feeding is projected lower with corn feeding reduced 2.6 million tons. Global barley feeding is also reduced 1.3 million tons this month. Global coarse grain stocks for 2008/09 are projected higher this month with corn ending stocks raised 4.6 million tons and barley ending stocks raised 1.1 million tons.

RICE: U.S. rice production in 2008/09 is forecast at 203.5 million cwt, 0.7 million below last month due to a lower yield. Average yield is estimated at 6,959 pounds per acre, down 23 pounds from last month. Harvested area is unchanged at 2.92 million acres. Long-grain rice production is lowered 0.5 million cwt to 154.7 million, while combined medium- and short-grain production is lowered 0.2 million to 48.7 million. Imports and domestic and residual use are unchanged from a month ago. However, exports are lowered 1 million cwt to 107 million from a month earlier. Long-grain exports are lowered 1 million cwt to 84 million, while combined medium- and short-grain exports are unchanged at 23 million. Ending stocks are projected at 25.4 million cwt, nearly unchanged from last month. The all rice season-average farm price is forecast at $14.50 to $15.50 per cwt, down $1.35 per cwt on both ends of the range. The long-grain season-average farm price range is projected at $13.85 to $14.85 per cwt, down $1.65 per cwt on each end of the range. The combined medium- and short-grain farm price range is projected at $17.00 to $18.00 per cwt, down $0.50 per cwt on each end.

Declining global rice prices and weak import demand have reduced price expectations for the remainder of the marketing year. Reported monthly farm prices from NASS through mid-October indicate a downward trend for both long- and combined medium- and short-grain rice. Global 2008/09 rice production, consumption, trade, and ending stocks are raised from a month ago. World production is forecast at a record 434.3 million tons, up a million tons from last month due mainly to increases for China, India, Pakistan, South Korea, and several African countries, which are partially offset by reductions for the United States, Brazil, and Russia. Global consumption is raised from a month ago due mainly to increases for China and several African countries. Exports are increased for China, India, and Pakistan and lowered for the United States. Imports are raised for several African countries including Cote D'Ivoire, Mauritius, and Reunion. Global ending stocks for 2008/09 are projected at 80.6 million tons, up slightly from last month, and an increase of 2.2 million from the 2007/08 estimate.

OILSEEDS: Total U.S. oilseed production is projected at 88.2 million tons, down 0.5 million tons due to lower soybean and cottonseed production. Soybean production is forecast at 2.921 billion bushels, down 17 million bushels based on a lower soybean yield of 39.3 bushels per acre. Soybean crush is reduced 15 million to 1.745 billion bushels due to lower values for soybean oil and soybean meal. Soybean ending stocks are unchanged at 205 million bushels. Soybean and product price forecasts are all reduced this month. The U.S. season-average soybean price for 2008/09 is projected at $9.10 to $10.60 per bushel, down 45 cents on both ends of the range reflecting lower cash and futures prices. Soybean meal prices are projected at $255 to $315 per short ton, down $5 on both ends of the range. Soybean oil prices are projected at 37.5 to 41.5 cents per pound, down 6.5 cents on both ends of the range.

Global oilseed production for 2008/09 is projected at 417.8 million tons, down 1.3 million tons from last month. Foreign production is reduced 0.7 million tons as lower soybean and cottonseed production is only partly offset by higher rapeseed and sunflowerseed production. Brazil soybean production is projected at 60 million tons, down 2.5 million tons from the previous forecast due to reduced area and yield. Despite a strengthening U.S. dollar that has mostly offset the effect of declining soybean prices, recent Brazilian government surveys indicate a lower area projection due to higher costs and reduced credit availability. Global rapeseed production is projected higher mainly due to an increase for China. Recently released government statistics indicate higher rapeseed area, resulting in a 0.5 million ton increase in production to 11.5 million tons. Rapeseed production is projected 0.2 million tons lower for Australia due to lower yields related to excessively dry conditions in some growing areas. Sunflowerseed production is raised for both Ukraine and Russia due to higher-than-expected yields. Sunflowerseed production is also raised for EU-27. Other changes include higher soybean production for China and EU-27, lower peanut production for China, and lower cottonseed production for Brazil.

SUGAR: Projected 2008/09 U.S. sugar supply is increased 251,000 short tons, raw value, from last month. Carry-in stocks are the final ending stocks reported for 2007/08. Beet sugar production for 2008/09 is increased 25,000 tons based on the larger forecast sugarbeet crop. Tariff rate quota (TRQ) imports are increased 75,000 tons to reflect the re-allocation of Mexico's share of the refined sugar quota announced on August 6. Partially offsetting, the TRQ shortfall is increased 30,000 tons based on new information about sugar supply and demand in quota holding countries. Ending stocks are raised 251,000 tons from last month to 907,000 tons, down 783,000 tons from last year. For 2007/08, year-end data from processors published in Sweetener Market Data (SMD) raise ending stocks 181,000 tons from last month. With other final data adding marginal changes to 2007/08 supply and use, the increase in reported ending stocks results in a miscellaneous statistical discrepancy of -269,000 tons on the use side. This amount comprises three miscellaneous uses in SMD (inventory adjustments, refining losses, and intra-industry transfers) and the difference between imports recorded in SMD and official imports (from U.S. Customs Service and the Census Bureau). The difference in import reporting accounts for 86 percent of the statistical discrepancy.

LIVESTOCK, POULTRY, AND DAIRY: Total U.S. meat production forecasts for 2008 and 2009 are reduced from last month, primarily reflecting lower pork and broiler production for 2008 and lower forecast pork production for 2009. Beef production is reduced fractionally based on the third-quarter production estimate. Pork production for 2008 is lowered because of the slower-than-expected pace of hog slaughter this quarter. The broiler production forecast for 2008 is reduced as a higher third quarter estimate is more than offset by expectations of lower production in the fourth quarter. Hatchery data point to declining eggs set and bird weights have recently begun to decline. Turkey production is raised on higher projected fourth-quarter production. Pork production forecasts for 2009 are reduced from last month as hog slaughter is expected to be lower due to smaller imports of hogs from Canada. There are no changes to other meats for 2009.

Export forecasts for beef and pork in both 2008 and 2009 are reduced as softer international demand and a stronger U.S. dollar are expected to dampen sales. Beef import forecasts are reduced from last month but pork imports are raised. Broiler exports are increased for 2008 as stronger-than-expected shipments in the third quarter more than offset weaker sales in the fourth quarter. Broiler export forecasts are unchanged for 2009. Turkey exports for 2009 are reduced due to weakening demand and a stronger U.S. dollar. Cattle and hog price forecasts for both 2008 and 2009 are lowered as a result of weaker exports. Broiler price forecasts are unchanged. Turkey price forecasts for 2008 and 2009 are lowered slightly due to higher domestic supplies.

Milk production forecasts for 2008 and 2009 are increased slightly from last month. Cow number forecasts are unchanged from last month. Forecast 2008 milk per cow is raised from last month due to higher-than-expected August and September estimates. Lower expected feed prices in 2009 should support slightly higher growth in milk per cow although gains are expected to remain below historical rates of increase. Weaker international markets will boost domestic supplies. Skim solids stocks for 2009 are reduced as domestic use of skims is forecast higher albeit at lower prices. Sales of nonfat dry milk (NDM) to the CCC are forecast for 2008 and 2009. Class III and Class IV prices for 2008 and 2009 are reduced from last month as most product price forecasts are lowered. Weak international demand and relatively large supples of NDM are expected to result in sharply lower forecast NDM prices. Although relatively weak expected demand could pressure butter prices, relatively higher Class III prices versus Class IV prices may encourage milk to flow to cheese production, tightening butter supplies and supporting prices. Cheese prices are lowered reflecting larger expected supplies of cheese. Whey prices are forecast lower than last month on weaker demand. The all milk price is forecast lower this month, averaging $18.30 to $18.40 in 2008 and $15.30 to $16.20 in 2009.

COTTON: This month's U.S. cotton estimates for 2008/09 include marginal changes in beginning stocks and production, which are largely offsetting. Beginning stocks are raised 153,000 bales from last month due to a revision in 2007/08 ending stocks by the U.S. Census Bureau. Production is lowered slightly, as reductions in the Delta and Southwest regions are partially offset by an increase for the Southeast. Domestic mill use is unchanged. Despite lower world demand, the U.S. export estimate is maintained at 13.0 million bales, because U.S. cotton has become relatively more competitive in recent weeks. The forecast for the average price received by producers is lowered 7 cents on the upper end and 6 cents on the lower end of the range, as market prices have fallen sharply since the October report.

The world 2008/09 cotton estimates show modestly lower production and sharply lower consumption compared with last month, raising ending stocks by 3.5 percent. World production is reduced about 900,000 bales, due mainly to reductions in the African Franc Zone, Brazil, and the United States. World consumption is reduced 2.4 percent from last month, due to mounting evidence of consumer retrenchment and a slowdown in mill activity around the world. China accounts for more than half of the world reduction; consumption also is reduced in Brazil, India, Pakistan, Thailand, and Turkey. Lower consumption is estimated to reduce world trade by 1.0 million bales, including a reduction of 500,000 bales in imports by China. World stocks are raised nearly 2.0 million bales from last month. Stocks in China are raised 1.25 million bales, as the government of China is buying cotton for the national reserve to support domestic prices.

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