April 11, 2006

USDA expects lower corn stocks, higher exports

The US Department of Agriculture Monday (Apr 10) cut its forecast for US corn ending stocks by 50 million bushels and raised its prediction for exports by 50 million bushels.

The USDA lowered its carryout forecast and raised its exports forecast by the exact same amounts in March.

Analysts generally expected both the decrease to corn stocks and the boost for exports in the USDA forecast, though the carryout cut was expected to be deeper.

The April prediction, released in USDA's monthly supply and demand report, lowered expected 2005/06 US corn ending stocks to 2.301 billion bushels and raised expected exports to 1.95 billion bushels.

"Exports increase due to reduced competition from Argentina," the USDA said in the April report.

Argentina, according to the monthly report, is now expected to produce just 14 million tonnes of corn in 2005/06. That is a reduction from USDA's March forecast of 15.5 million tonnes. The USDA prediction for country's exports was reduced to just 8.5 million tonnes, a 1.5-million-tonne drop from 10 million tonnes.

The USDA left its forecast for China's corn export forecast unchanged at 5 million tonnes. A month ago, in USDA's March report, it lowered that figure by 1 million tonnes, down from the February forecast of 6 million tonnes.