USDA's June 1 Stocks confirms expected corn use

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According to the USDA's Feed Outlook report, the Grain Stocks report, issued by USDA’s National Agricultural Statistics Service (NASS) June 29, 2012, showed the June 1 corn stocks and indicated March-May disappearance near expectations, resulting in no change to projected feed and residual use for 2011/12. This month’s changes to 2011/12 corn trade raise carryin for the 2012/13 marketing year 52 million bushels over last month’s projection, but beginning stocks remain down dramatically, at 80 percent of the 2011/12 estimate.

click image to zoomSource: USDA, National Agricultural Statistics Service, Prospective Planting report, March 2012 and Acreage report, June 2012.Figure 2. The projected stocks-to-use ratio is 9.3, compared with 7.2 for 2011/12. June 1 stocks for sorghum also confirmed expected March-May disappearance and resulted in no change to annual feed and residual use for 2011/12. June 1 stock estimates increase barley 2011/12 ending stocks 8 million bushels and raise oats ending stocks 3 million bushels. Ending stocks for 2011/12 are down from 2010/11 for all four of the feed grains but are expected to increase in 2012/13, with larger area and production expected for these crops.

Corn ending stocks for 2012/13 are lowered 698 million bushels from last month’s projection, based on reduced production partly offset by higher carryin and imports, as well as reduced forecast use.

click image to zoomSources: USDA, World Agricultural Outlook Board, WASDE,and USDA, National Agricultural Statistics Service,Quick Stats.Figure 3. Sorghum and oats ending stocks are down 5 and 2 million bushels, respectively, as projected sorghum use increases and oats supplies tighten this month. Projected barley ending stocks are increased 5 million bushels on higher production and carryin, partially offset by increased feed and residual use. The 2012/13 corn import projection is raised 15 million bushels to 30 million.

Canada is projected to have sharply increased corn production in 2012/13, and relative prices may facilitate U.S. corn imports from Brazil. Estimated imports of corn for 2011/12 are raised 2 million bushels to 22 million bushels on continued strong shipments, largely from Canada.

Corn feed and residual use for 2012/13 is lowered 650 million bushels, as tighter supplies and higher prices discourage feeding and lower production reduces residual disappearance. For the 2011/12 marketing year, continuing high prices are expected to limit corn use for feed. click image to zoomSources: USDA, World Agricultural Outlook Board, WASDE,and USDA, National Agricultural Statistics Service,Quick Stats.Figure 4. June-August 2012 corn feed and residual use is expected to be down from last year as early planting and dryness accelerate harvesting ahead of the start of the new marketing year in September.

Feed and residual use in the second half of the 2011/12 marketing year is estimated at 1,183 million bushels, or only 26 percent of the 4,550 million bushels projected for the year. Except for 2010/11, this amount would be lower than that in any year, both in absolute and percentage terms, in the history maintained by USDA back to 1975.

Sorghum feed and residual for 2012/13 is projected 10 million bushels higher at 100 million bushels, as higher plantings increase supplies, especially in Texas and Kansas.

click image to zoomSources: USDA, Agricultural Marketing Service, Weekly Grain Market News, and USDA, Economic Research Service, Feed Grains Database.Figure 5. For 2011/12, sorghum feed and residual use is unchanged based on indications from the June 1 stocks. The July projection for barley feed and residual use is increased by 20 million bushels for 2012/13, reflecting increased supplies and strong demand for substitutes for corn.

Barley feed and residual is lowered 8 million bushels for 2011/12, reflecting the June 1 stocks estimate. For oats, the July 2012/13 projection for feed and residual use is lowered 10 million bushels, reflecting lower production. For 2011/12, ending stocks are estimated 3 million bushels lower, reflecting the June 1 stocks.

Grain consuming animal units (GCAUs) are increased for July. For 2012/13, higher inventory numbers for cattle on feed boosted GCAUs from 92.6 to 92.9. For 2011/12, GCAUs increased from 93.3 to 93.7 on higher poultry inventory.

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