WASDE Coarse Grains: Increased Corn Usage, Reduced Corn Stocks

This month’s 2017/18 U.S. corn outlook is for increased corn used to produce ethanol and reduced ending stocks. Corn used to produce ethanol is raised 50 million bushels to 5.525 billion, based on increased sorghum export commitments, and the most recent data from the Grain Crushings and Co-Products Production report, which estimated a lower-than-expected amount of sorghum used to produce ethanol during October. With no other use changes, ending stocks are down 50 million bushels from last month.

The projected season-average farm price is unchanged this month at a midpoint of $3.20 per bushel but the range is narrowed 5 cents on each end to $2.85 to $3.55 per bushel.

For sorghum, recent large purchases by China have increased sorghum prices relative to corn, sharply reducing the estimated amount of sorghum used to produce ethanol. With expectations of increased U.S. sorghum exports to China, projected food, seed, and industrial use for sorghum is reduced by 50 million bushels, with an offsetting 50 million bushel increase in exports.

Global coarse grain production for 2017/18 is forecast 1.4 million tons higher to 1,323.9 million. The 2017/18 foreign coarse grain outlook is for larger production, increased consumption, and higher stocks relative to last month. Foreign corn production is forecast higher with increases for China, the EU, Laos, and Guatemala more than offsetting a reduction for Russia.

China’s corn production is raised based on the latest data from the National Bureau of Statistics. EU corn production is higher, mostly reflecting an increase for Romania that more than offsets declines for several countries.

Corn exports are lowered for Russia but raised for the EU. Foreign corn ending stocks are raised from last month, largely reflecting increases for China, the EU, and Brazil that more than offset declines for Egypt and Mexico. Global corn stocks, at 204.1 million tons, are up slightly from last month.

Full report.

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