(Posted Fri. Jul 10th, 2015)
Corn production estimates issued by the U.S. Department of Agriculture today were lowered by 100 million bushels from last month’s estimate, reflecting acreage reductions made in the June 30 acreage report. With corn use, exports, and feed and residual use offsetting increase to expected demand from ethanol markets, the projected average corn price was raised by roughly 25 cents per bushel.
In its report, USDA projected beginning stocks to be 1.77 billion bushels, a 97-million-bushel decrease. The revisions are the result of increases of the forecast corn use in ethanol production, exports and feed and residual use for 2014/2015. Revisions to demand for 2015/2016 largely offset one another.
Forecasts were revised to show farmers planting 88.9 million acres and harvesting 81.1 million acres, both reflecting decreases indicated by the June acreage report. Average yield held steady at 166.8 bushels per acre, but this may change following the first reports reflecting on-the-ground data on yield in August. Total production of 13.5 billion bushels will be down from 2014 corn production of 14.2 billion bushels.
Given stock and production revisions, USDA continues to estimate the average farm price for the current market year at $3.45 to $4.05 per bushel, a 25-cent increase from June’s report.