July 13, 2007

USDA predicts 505 million bushels increase for 2007/08 corn ending stocks

The US Department of Agriculture, now expecting US farmers to plant even more corn than in earlier predictions, said Thursday (July 12) it is raising its 2007/08 ending stocks forecast to 1.502 billion bushels, up more than half-a-billion bushels from the June forecast of 997 million.

Corn carrying stocks will also be higher than expected, the USDA said in its monthly supply and demand report. The new beginning stocks forecast is for 1.137 billion bushels, up from the USDA's June prediction of 987 million bushels.

Planting expectations, based on a recent survey released in June, show more acreage dedicated to the crop than the US has seen in more than 60 years and production will be strong, the USDA said. Farmers are now expected to produce 12.84 billion bushels, up from the USDA's June forecast of 12.46 billion.

Corn planting and production, spurred on by US ethanol production, are both up from forecasts last month, but the forecast for demand from the ethanol industry remains unchanged at 3.4 billion bushels.

The situation in the US is good for exporters, the USDA said.

"Exports for 2007-08 are raised 25 million bushels as larger domestic supplies, lower prices, and reduced (competition from) foreign exports boost prospects for US corn shipments," the USDA said on July 12. The USDA set the July forecast for corn exports at 2 billion bushels, up from 1.975 billion a month ago.