December 12, 2008
USDA lowers corn usage forecast by US ethanol producers
Widespread financial problems in the US ethanol industry and falling gasoline prices will translate into a drop in the consumption of corn by the fuel producers in the 2008-09 marketing year, the US Department of Agriculture said Thursday (December 11).
The USDA, in its monthly world supply and demand report, lowered its forecast for corn usage by the ethanol sector to 3.7 billion bushels, a 300-million-bushel drop from its November forecast.
"Ethanol use is projected 300 million bushels lower this month as prospects for blending above federally mandated levels decline," the USDA said in its December edition of the World Agricultural Supply and Demand Estimates report. "Financial problems for ethanol producers are reducing plant capacity utilization for existing plants and delaying plant openings for those facilities under construction."
The USDA left its forecast for corn production unchanged, but the prediction for 2008-09 ending stocks was raised to 1.474 billion bushels. That's 350 million bushels more than the USDA forecasted just a month ago.