WASDE Coarse Grains: Reduced U.S. Corn Demand, Higher Stocks

This month’s 2019/20 U.S. corn outlook is for larger supplies, reduced exports and corn used for ethanol, and greater ending stocks. Corn production is forecast at 13.9 billion bushels, up 26 million from the July projection as a decline in harvested acres is virtually offset by an increase in yield. The season’s first survey-based corn yield forecast, at 169.5 bushels per acre, is 3.5 bushels higher than last month’s projection.

Today’s Crop Production report indicates that Illinois, Indiana, Iowa, Minnesota, Nebraska, Ohio, and South Dakota are forecast to have yields below a year ago. Of the major producing states, only Missouri is forecast to have yields above a year ago. Corn used for ethanol is reduced 25 million bushels to 5.5 billion.

Exports are lowered reflecting U.S. export competitiveness and expectations of increasing competition from Argentina, Brazil, and Ukraine. With supply rising and use falling, ending stocks are up 171 million bushels to 2.2 billion. The season-average corn price received by producers is lowered 10 cents to $3.60 per bushel.

This month’s 2019/20 foreign coarse grain outlook is for larger production, increased trade, and greater stocks relative to last month. Ukraine corn production is projected record high, reflecting increases to both area and yield. Cool temperatures and timely rain during reproduction are expected to boost yield prospects.

EU corn production is raised, as increases for Romania, Hungary, and Bulgaria more than offset declines for Poland, France, and Germany. Barley production is raised for Argentina and Russia, but lowered for Turkey, the EU, and Kazakhstan.

Major global coarse grain trade changes for 2019/20 include corn export increases for Ukraine and Serbia, with a partially-offsetting reduction for Russia. For 2018/19, exports for Argentina and Brazil are raised for the local marketing year beginning March 2019, based on larger-than-expected shipments during the month of July.

Corn imports for 2019/20 are raised largely reflecting increases for the EU and Indonesia. For China, corn feed and residual use is lowered based on lower forecast protein meal consumption. Foreign corn ending stocks are higher relative to last month, mostly reflecting increases for China, EU, Ukraine, and Turkey partially offset by reductions for Argentina and Indonesia.

Full report.


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