WASDE Coarse Grains, Corn

May 10, 2010 07:00 PM


Total U.S. corn use for 2010/11 is projected up 2 percent from the current year with higher expected food, seed, and industrial (FSI) use and exports more than offsetting a decline in projected feed and residual use. FSI use is projected 4 percent higher with a 200-million-bushel increase in corn used for ethanol accounting for most of the increase. Corn ethanol use, projected at 4.6 billion bushels, is supported by rising Federal biofuels mandates and strong blending incentives that continue to boost ethanol usage. Exports are projected up 3 percent with larger supplies and lower prices, but rising foreign feed grain supplies, mostly corn, limit export growth in 2010/11. Domestic corn feed and residual use is projected down slightly with a slow recovery in animal numbers and increased use of distiller's grains. U.S. corn ending stocks for 2010/11 are projected up 5 percent to 1.8 billion bushels. The season-average farm price is projected at $3.20 to $3.80 per bushel compared with the 2009/10 forecast of $3.50 to $3.70 per bushel.

Changes to the 2009/10 corn balance sheet include higher FSI use and exports, which are partly offset by lower expected feed and residual use and lower production with downward revisions to harvested area and yields for North Dakota and South Dakota. FSI is revised back to 1997/98 to better reflect net exports of sweeteners and starch as indicated by U.S. Bureau of Census data. These changes raise FSI slightly and lower feed and residual use offsetting amounts. The largest changes are in the most recent years when foreign demand for U.S. corn sweeteners has been strongest. Feed and residual use for 2009/10 is lowered 75 million bushels, in part, reflecting increased availability of distillers grains with a 100-million-bushel increase in projected corn use for ethanol. Exports are raised 50 million bushels based on recent strength in sales and shipments. These changes combine with the 21-million-bushel reduction in 2009/10 production to lower ending stocks 161 million bushels.

Global coarse grain production for 2010/11 is projected at a record 1,129.8 million tons, up 2 percent from 2009/10. Most of the 27.4-million-ton increase in coarse grains production results from higher projected foreign corn production, up 19.9 million tons from 2009/10. Higher expected foreign corn area and rising yields combine with higher U.S. area to boost global corn production to a record 835.0 million tons, up 26.5 million from 2009/10. Corn production is projected higher year-to-year for China, Mexico, India, Russia, EU-27, Ukraine, and Canada. Corn production is expected to be lower in Brazil and South Africa. World coarse grain trade is higher for 2010/11 mostly reflecting rising projected corn imports and exports. Global corn consumption is projected to be record high at 827.9 million tons, up 19.0 million from 2009/10, with nearly three-quarters of the increase in foreign markets. World corn ending stocks are projected at 154.2 million tons, up 7.2 million from 2009/10 and the highest since 2000/01. With stocks for China projected up 6.9 million tons, other country changes year-to-year are mostly offsetting.

The 2010/11 outlook for U.S. feed grains is for larger supplies with higher beginning stocks and production; however, rising use is expected to limit the growth in ending stocks.

roduction for 2010/11 is projected at 13.4 billion bushels, up 260 million from 2009/10 as a 2.3-million-acre increase in intended plantings more than offsets a projected decline in yield from last year's record. Based on the rapid pace of 2010 planting as reported in Crop Progress, the 2010/11 yield is projected at 163.5 bushels per acre, 2.7 bushels above the 1990-09 trend. Corn supplies are projected at a record 15.1 billion bushels, 325 million higher than in 2009/10.
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