WASDE: Corn price outlook lowered
According to the USDA's latest World Agricultural Supply and Demand Estimates (WASDE) report, U.S. feed grain supply and use projections for 2012/13 are unchanged this month, but price outlooks for corn and sorghum are lowered based on prices reported to date. The season-average farm price for corn is lowered 20 cents at the midpoint and the projected range is narrowed to $6.80 to $8.00 per bushel.
Prices received by farmers through October remained well below cash market bids and this year’s early corn harvest appears to have boosted early season marketings placing further downward pressure on the outlook for the season-average price. The season-average sorghum price is lowered 10 cents at the midpoint and the projected range is narrowed to $6.50 to $7.70 per bushel.
The projected barley and oats season-average price ranges are narrowed 5 cents on each end to $6.10 to $6.80 per bushel and $3.55 to $4.05 per bushel, respectively.
Global coarse grain supplies for 2012/13 are projected 7.0 million tons higher mostly reflecting a larger reported corn crop for China. Beginning coarse grain stocks for 2012/13 are lowered 1.0 million tons in part reflecting higher 2011/12 corn exports for Argentina.
Global 2012/13 corn production is raised 9.4 million tons with China corn output up 8.0 million tons based on recent estimates from the National Bureau of Statistics. Strong price incentives to expand corn plantings and favorable summer rainfall, particularly in the northeast provinces, support increases in area and yields raising them to new records.
Corn production for Canada is raised 1.5 million tons this month to a new record on higher yields and a record area as reported by Statistics Canada. Russia corn production is raised 1.0 million tons, also a new record. Corn production is increased for North Korea and Chile, up 0.4 million tons, and 0.3 million tons, respectively.
Offsetting these increases are reductions for Argentina, Moldova, and Ukraine corn, down 0.5 million tons each, with lower expected area for Argentina, lower area and yields for Moldova, and lower yields for Ukraine. Belarus corn production is also lowered 0.2 million tons.
Other notable 2012/13 coarse grain production changes this month include a 0.6-million-ton reduction for Canada barley, a 0.3-million-ton reduction for Australia sorghum, and 0.3-million-ton and 0.2-million-ton reductions, respectively, for Canada and Australia oats. All are based on the latest official estimates from Statistics Canada and the Australian Bureau of Agricultural and Resource Economics and Sciences.
Global 2012/13 coarse grain trade is increased mostly on higher expected corn imports and exports. Corn imports are raised 1.5 million tons for EU-27. Corn exports are raised 0.5 million tons each for Canada and Russia.
Increases in local marketing year 2011/12 exports for Argentina, Paraguay, and South Africa support higher 2012/13 consumption this month for Northern Hemisphere countries.
Global corn consumption for 2012/13 is raised 8.7 million tons mostly with increases of 6.0 million tons and 1.5 million tons, respectively, for China and EU-27 corn feeding.
Corn feed and residual use is also raised for Canada and Russia, but lowered for Argentina, Ukraine, and Moldova. Corn food, seed, and industrial use is raised 2.0 million tons for China, also boosting global corn consumption. World corn ending stocks for 2012/13 are projected 0.4 million tons lower, mostly on reductions in Argentina, Colombia, and Ukraine. Small increases in a number of countries, including Canada, are partly offsetting.