According to the USDA's Feed Outlook report, high grains prices, lead by strong U.S. corn prices, are expected to reduce coarse grain use, both for the United States and foreign countries. World coarse grain disappearance is forecast down 25.3 million tons to 1,180.9 million, with a large drop in U.S. use. Foreign coarse grain use for 2012/13 is projected down 6.7 million tons this month to 886.2 million. Half of the reduction, 3.4 million tons, is in foreign feed and residual use, with the balance in food, seed, and industrial use.

Foreign corn use is reduced 3.7 million tons to 618.1 million, but feed use is trimmed only 0.9 million tons to 414.0. Foreign barley disappearance is projected down 2.8 million tons this month, with most of the decline in feed. There are also small declines for oats, millet, and rye, but a slight increase in projected mixed grain use.

The largest decline in projected 2012/13 corn use is for India, down 0.8 million tons, with three quarters of the decline in food and industrial use. Forecast 2012/13 corn feed use is reduced 0.5 million tons each for Japan and South Korea as weak demand in 2011/12 (also reduced this month) is expected to persist.

With reduced production prospects, Peru’s corn use is projected slightly lower. However, expected corn use is up 0.2 million tons each for Paraguay and Canada. Canada has increased production prospects, and Paraguay is using more of its corn crop domestically instead of exporting, both for 2011/12 and 2012/13. Most of the decline in foreign corn use is an accounting result of the trade changes on a local marketing year. World corn exports are reduced 7.02 million tons this month, while imports are trimmed 4.57 million, resulting in a 2.45 million reduction in disappearance.

Barley use is expected lower in 2012/13, mostly in countries with reduced production, including Ukraine, down 0.8 million tons; Russia, down 0.6 million; Australia and Canada, each down 0.3 million; and Kazakhstan, down 0.2 million. Reduced import prospects trim barley consumption forecasts this month for Israel, down 0.3 million tons, and Syria, down 0.2 million.