Supply and demand report reflects lowered yields
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WASHINGTON, July 11, 2012- The USDA's World Agricultural Supply and Demand Estimates (WASDE) report released today reflects lowered yield for corn and soybean due to harsh weather conditions.
The projected U.S. corn yield is lowered 20 bushels per acre to 146 bushels. Feed grain supplies for 2012/13 are projected sharply lower with corn production prospects reduced 1.8 billion bushels from last month.
“Persistent and extreme June dryness across the central and eastern Corn Belt and extreme late June and early July heat from the central Plains to the Ohio River Valley have substantially lowered yield prospects across most of the major growing regions,” according to the report. “Harvested area is also reduced slightly based on the June 29 Acreage report.”
Corn ending stocks for 2012/13 are projected at 1.2 billion bushels, down 698 million from last month's projection. The season average 2012/13 farm price for corn is projected at $5.40 to $6.40 per bushel, up sharply from $4.20 to $5.00 per bushel in June.
“Reduced supplies and higher prices are expected to sharply lower 2012/13 corn usage with the biggest reduction for feed and residual disappearance, projected down 650 million bushels,” according to the report. “Food, seed, and industrial use is also projected lower, down 105 million bushels, mostly reflecting a 100-million-bushel reduction in corn used to produce ethanol.”
“Exports are projected 300 million bushels lower as tight supplies, higher prices, and strong competition from South American exporters limit U.S. shipments,” continued the WASDE corn supply estimates.
Lower soybean production accounts for most of the reduced projection of U.S. oilseed production to 92.7 million tons, down 4.2 million from last month. Soybean yield is projected at 40.5 bushels per acre, down 3.4 bushels from last month. Production is projected at 3.050 billion bushels, down 155 million as increased harvested area is more than offset by reduced yields, stated the report.
“The drop reflects sharply declining crop conditions resulting from limited rainfall since early April coupled with excessive heat across much of the producing area in late June and early July,” according to the report, which added that soybean supplies are 160 million bushels below last month's forecast due to lower beginning stocks and reduced production.
The report raised prices for soybeans and soybean meal for 2012/13. The U.S. season average soybean price is projected at $13.00 to $15.00 per bushel, up $1.00 on both ends of the range. Soybean meal prices are projected at $365 to $395 per short ton, up $30 on both ends of the range. The soybean oil price projection is unchanged at 52.5 to 56.5 cents per pound.
WASDE projected global corn consumption to drop 22.9 million tons with most of the decline in the United States. Global corn ending stocks are projected 21.7 million tons lower with the United States accounting for 17.7 million tons of the decline.
Global oilseed production for 2012/13 is projected at 465.7 million tons, down 5.1 million from last month. Global soybean production is projected at 267.2 million tons, down 3.9 million mostly due to lower production in the United States, according to the report.
Global oilseed ending stocks for 2012/13 are projected at 63.1 million tons, down 2.7 million as reduced supplies are only partly offset by lower crush, while lower soybean stocks in the United States and South America account for most of the change.
For more information from the WASDE report on soybean, corn and other commodities click here.
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