USDA predicts record corn crop

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Despite delayed planting in rain-soaked parts of the corn belt, USDA last week said that according to farmer survey data and historical yield trends, 92.2 million acres of corn are to be planted this year, 85.1 million harvested acres, and an average yield of 158.7 bushels per acre. The number would indicate an all-time crop record of 13.5 billion bushels.

The forecast was seen as good news by the Renewable Fuels Association. “American farmers appear poised to once again respond to market signals and increase their productivity without needing to convert non-agricultural land to cropland,” said Renewable Fuels Association Vice President of Research and Analysis Geoff Cooper.

“Obviously, this is USDA’s first bite at the apple and a lot can change between now and the fall that could make the crop larger or smaller. Nevertheless, by all indications, it appears that farmers are prepared to supply enough corn to meet demand and add to surplus levels.”

Cooper also said that historically, there is little correlation between planting dates and yields, noting that this year’s planting pace is almost identical to the slow pace seen in 2009 when growers produced a record yield of 164.7 bushels per acre.

The ethanol industry is under pressure from many in Congress and from those sectors experiencing higher corn costs, such as food manufacturers and livestock producers, who want to see incentives for ethanol, including subsidies and production mandates, reduced or eliminated. Short ending stocks are also raising questions about corn-for-ethanol production.

But USDA also increased its estimate for carry-out stocks of corn for 2010/11 to 730 million bushels, based on slightly lower export demand. And the department said that for the 2011/2012 marketing year beginning September 1, total corn use is projected at 13.355 billion bushels. USDA is projecting demand of 5.05 billion bushels for ethanol use, which translates to more than 14 billion gallons. After all demands are met, USDA expects 2011/12 carry-out to be 900 million bushels, up nearly 25% from the current marketing year.

Meanwhile the RFA this week issued a report, “Fueling a Nation; Feeding the World,” that says U.S. ethanol producers supplied nearly 35 million metric tons (mmt) of livestock feed in the 2009/2010 marketing year. The RFA says that by volume, that amount is greater than the total amount of grain consumed by all of the beef cattle in the nation’s feedlots.

“Too often, discussions of the ethanol industry’s impact on global grain use forget to recognize the fact that the grain ethanol process results in renewable fuel and highly nutritious animal feed,” the RFA says in a statement issued with the report. “In modern ethanol production processes, one-third of every bushel of corn used is returned to the livestock feed market.”

Source: 25x’25 Weekly REsource

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