(Posted Thu. May 10th, 2012)
May 10: U.S. corn farmers are on course to shatter production, yield and supply records according to a U.S. Department of Agriculture report released this morning. Projecting a record production of 14.8 billion bushels with record average yields of 166 bushels per acre, the report provides an extremely positive initial assessment of the 2012 corn crop. Additionally, the projected increases in harvest acres and expected yields put the country on track for a record corn supply of 15.7 billion bushels, 2.2 billion higher than in 2011.
“In farm communities across the country, there has been a positive buzz building about this crop as early planting and emergence have given farmers a solid reason to be optimistic,” said National Corn Growers Association President Garry Niemeyer, a grower in Illinois. “The estimates released by USDA today show that the experts in government agree with our assessments on the ground. Farmers have worked hard to lay the groundwork for a bountiful harvest and now hope that the weather will continue cooperating so that we can remain on this record-breaking course.”
If projections hold, projected corn production of 14.8 billion bushels would surpass the 2011 crop by 2.4 billion bushels. The report indicated that this estimate includes a 5.1 million acre increase in harvested area and expectations of yields significantly higher than those seen in 2011. Given the early planting and emergence this year, the agency forecasts record average yields of 166 bushels per acre, two bushels per acre above the 1990-2010 trend.
The report also forecasts that U.S. corn use in the 2012-2013 crop marketing year will be nine percent higher than in 2011-2012. These forecasts reflect higher projected feed and residual disappearance, increased demand for use in sweeteners and starch, and a larger demand from export markets.
Feed and residual use projections show an increase of 900 million bushels reflecting a sharp rebound in residual disappearance with the record crop and an increased demand for corn for feed resulting from the combination of lower corn prices and expected increases in pork and poultry production.
Export demand is forecast to increase by 200 million bushels over the prior year with an abundant domestic corn supply, lower prices and increased demand from China fueling the change. U.S. shipments will be limited by forecasted record foreign corn supplies.
Projected corn use by the ethanol sector, which also produces the feed ingredient distillers grains as a co-product, did not change this year, as weak gasoline consumption will limit domestic blending opportunities.
Ending stocks 2012/2013 are projected at 1.9 billion bushels, a full billion bushels above projections for 2011/2012.
The season-average farm price projections of $4.20 to $5.00 per bushel show a sharp decline from the 2011/2012 record, which is projected at $5.95 to $6.25 per bushel, due to increased supply.
For the full report, click here.