August 13, 2007

USDA sees stronger US corn production this year

US farmers are now forecast to produce even more corn at 13.1 billion bushels, up 214 million from last month's projection, the US Department of Agriculture (USDA) said Friday (August 10) after completion of the first field survey conducted this year.

The USDA said in its monthly World Agricultural Supply and Demand Estimates report that increased projection has also raised corn's ending stocks.

That's yet another forecast this year for increased corn production as the corn-based ethanol industry in the US remains strong. The forecast for ethanol-usage remains unchanged at 3.4 billion bushels. It was in May that the USDA increased its ethanol-usage forecast from 3.2 billion up to 3.4 billion bushels. The US ethanol industry used 2.15 billion bushels of corn in the 2006/07 marketing year.

Ending stocks, the USDA said, are now expected to total 1.516 billion bushels, up from the July forecast for 1.502 billion.

Corn yields are also forecasted higher, predicted USDA. Average yields this year are expected to be the second highest ever behind 2004.

"Yield forecasts are higher than last year across the Great Plains where frequent rainfall during much of the growing season provided abundant soil moisture for filling the crop," the USDA said in its Crop Production report, which was also released Friday.

The new average yield forecast is 152.8 bushels per acre, up from the prediction for 150.3 bushels per acre a month ago. The average last year was 149.1 bushels per acre.