USDA lowers US, global ending corn stocks in projections for 2018-19

11.05.2018

The US Department of Agriculture on Thursday projected domestic corn stocks at the end of the 2018-19 marketing year at 1.682 billion bushels (42.725 million mt), down 500 million bushels from its 2017-18 estimates of 2.182 billion bushels.

The lower ending stocks projection, the USDA's first for the 2018-19 marketing year, reflected a drop in the estimate for US corn production to 14.040 billion bushels, from 14.604 billion bushels in the previous marketing year.

"The corn crop is projected at 14.0 billion bushels, down from last year with a lower forecast area and yield", the USDA said. "The yield projection of 174.0 bushels per acre is based on a weather-adjusted trend assuming normal planting progress and summer growing season weather, estimated using the 1988-2017 time period."

The estimates of US corn to be used for ethanol production in the 2018-19 marketing year was at 5.625 billion bushels, from 5.575 billion bushels in the previous marketing year.

"Corn used to produce ethanol is up 50 million bushels mostly reflecting expectations of gasoline consumption growth," the USDA added.

The projection for the 2018-19 marketing year foresees 34.6% of the next season's corn supply going towards production of ethanol and byproducts, while 12.9% would be exported.

US corn exports are forecast to decline 125 million bushels in 2018-19, the USDA said.

"Reduced exports out of Argentina and Brazil during 2017/18 (local marketing years beginning March 2018) are expected to boost US exports during the first half of 2018/19," it said. "However, a nearly 265-million-bushel increase in the combined corn exports for Ukraine and Russia in 2018/19 will likely increase competition for the United States, reducing the forecast U.S. share of global corn trade from a year ago."

The USDA estimated the global corn ending stocks at 159.15 million mt, lower from its 2017-18 estimates of 194.85 million mt.

"Global corn ending stocks are down 35.8 million tons from a year ago, and if realized would be the lowest since 2012/13" it said.

The reduction in global year-ending stocks for the next marketing year was due to lower beginning stocks and increased use, offsetting the higher global production.

USDA is projecting a 40-cent rise in its US midpoint season average farm price for the 2018-2019 marketing year to $3.80/bushel, the agency said.

Corn is the primary feedstock for ethanol production in the US and is the main competitor for dried distillers grains.


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