November 10, 2011
US corn output forecast reduced again
The USDA reduced US corn output forecast again on Wednesday (Nov 9) to 12.31 billion bushels as the production was less than previously expected.
"Based on conditions as of November 1, yields are expected to average 146.7 bushels per acre, down 1.4 bushels from the October forecast and down 6.1 bushels from 2010," the USDA said in its Crop Production report. "If realised, this will be the lowest average yield since 2003."
According to Wall Street Journal, the new corn production forecast is a drop from the 12.433 billion bushels that USDA predicted in October and the 12.497 billion bushels in September, according to the crop report.
With a new lower expectation for corn production and a lower forecast for demand from the livestock feed industry, the USDA also said Wednesday it expects ending stocks for the commodity to drop to just 843 million bushels, down from the 866 million bushels that it predicted a month ago.
The new USDA forecast for "feed and residual use" is 4.6 billion bushels, down from 4.7 billion bushels, according to the agency's monthly World Agricultural Supply and Demand Estimates report, which was also released Wednesday.
Weaker than expected chicken production is to blame for the reduced demand for corn feed, the USDA said. US broiler production this year is now expected to total 36.3 billion pounds, down from an earlier forecast of 36.6 billion pounds.
The USDA did not increase its prediction for US corn exports, the figure remains at 1.6 billion bushels but the USDA did raise its forecast for Chinese imports of the commodity.
China, which gets most of its corn imports from the US, is now forecast by the USDA to import a total of three million tonnes in the 2011-12 marketing year. That is a sharp increase from the two million tonnes that USDA was predicting just a month ago. It is an even bigger leap from the 980,000 tonnes that the USDA says China imported the previous year.
The USDA also trimmed its production and yield forecasts for wheat and soy.
Excessive rains brought sharp delays for spring wheat farmers in northern Plains states this year and after the latest round of additional surveys in late October, the USDA again lowered its production forecast.
"Adjustment to production in these states, where significant acreage remained unharvested in early September, lowers production estimates for hard red spring wheat and durum," the USDA said. "An increase in white wheat production is partly offsetting."
US wheat farmers are now expected to produce 1.999 billion bushels of wheat, down from the October forecast of 2.008 billion bushels and the new yield estimate is 43.7 bushels per acre, down from 43.9 bushels per acre.
Meanwhile, the USDA lowered its forecast for US soy production slightly to 3.046 billion bushels, down from 3.06 billion bushels.
But the USDA, now predicting lower soy exports, raised its forecast for soy ending stocks to 195 million bushels.
"Soy exports are reduced 50 million bushels to 1.325 billion, mainly due to a slow export sales pace through October," the USDA said.