USDA Supply and Demand Report reflects planting estimates

By Agri-Pulse staff

© Copyright Agri-Pulse Communications, Inc.

WASHINGTON, April 10, 2012- The World Agricultural Supply and Demand Estimates report released by USDA today reflects last month's Prospective Plantings report as well as global production changes. Soybean exports for 2011/2012 rose this month, while seed use lowered to reflect last month's planting estimates. The Foreign Agricultural Service also announced today that private exporters reported export sales of 165,000 metric tons of soybeans to China during the 2012/2013 marketing year.

Highlights from today's reports are listed by commodity below: 

WHEAT: U.S. wheat ending stocks for 2011/12 are projected 32 million bushels lower. Projected feed and residual use is raised 35 million bushels reflecting higher-than-expected disappearance during the December-February quarter as indicated by the March 1 stocks. Projected seed use is lowered 3 million bushels based on state level seedings as reported in the March 30 Prospective Plantings report. Projected exports for all wheat are unchanged as a 15-million-bushel increase for

Soft Red Winter (SRW) wheat is offset by the same size reduction for Hard Red Winter wheat. U.S. feed grain balance sheets for 2011/12 are unchanged this month.

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GRAINS: The projected ranges for the season-average corn and sorghum farm prices are both narrowed 10cents on each end to $6.00 to $6.40 per bushel and $5.90 to $6.30 per bushel, respectively. The barley and oats farm price ranges are both narrowed 5 cents on each end to $5.25 to $5.45 per bushel and $3.40 to $3.50 per bushel, respectively.

Corn used to produce ethanol in 2011/12 is projected at 5.0 billion bushels, unchanged again this month. The latest monthly data from the Energy Information Administration (EIA) indicates that average daily ethanol disappearance fell to a 23-month low in January pushing ethanol stocks to a new record high. Weekly EIA ethanol production data suggest average daily ethanol production during February and March has continued to fall hitting its lowest level since early last fall.

Projected 2011/12 corn feed and residual use is unchanged at 4.6 billion bushels. March 1 stocks indicate a September-February feed and residual disappearance 238 million bushels lower than during the first 6 months of the 2010/11 marketing year. Prospects for feed and residual disappearance during the remainder of 2011/12 will be limited by an improving outlook for summer wheat feeding and the potential for 2012 new-crop corn use during August.

Larger expected supplies and competitive prices for wheat relative to corn suggest an increase in summer wheat feeding compared with last year. The quick start to corn planting this spring and more intended acres across the South raise the potential for a substantial increase in new-crop corn use before the September 1 start of the new marketing year.

OILSEEDS: U.S. soybean exports for 2011/12 are increased 15 million bushels this month to 1.29 billion. The U.S. soybean crush is raised 15 million bushels to 1.63 billion due to stronger-than-expected domestic soybean meal disappearance. Seed use is lowered to reflect plantings for 2012 reported in the March 30 Prospective Plantings report. Residual use is reduced based on indications from the March 30 Grain Stocks report. U.S. soybean ending stocks are projected at 250 million bushels, down 25 million from last month.

Soybean and soybean product prices are all projected higher this month. The U.S. season average soybean price range is projected at $12.00 to $12.50 per bushel compared with $11.40 to $12.60 last month. The soybean meal price is projected at $335 to $355 dollars per short ton compared with the previous projection of $310 to $340. The soybean oil price is projected at 52.5 to 54.5 cents per pound compared with the previous projection of 50.5 to 54.5 cents per pound. Global oilseed production for 2011/12 is projected at 440.6 million tons, down 5.2 million from last month.

Foreign production accounts for all of the change. Brazil soybean production is forecast at 66 million tons, down 2.5 million from last month as warm temperatures and a lack of rainfall since late February in the southern state of Rio Grande do Sul further reduced yield and production prospects. Argentina and Paraguay soybean production estimates also are further reduced this month, reflecting the damaging effects of this year's drought.

RICE: On the U.S. 2011/12 supply side, the all rice import projection is raised 0.5 million cwt to 20.5 million (in long-grain) based on the pace of imports as reported by the Census Bureau through January. Forecast beginning stocks and production are unchanged from a month ago. On the use side, all rice domestic and residual use is estimated at 123.0 million cwt, down 1.0 million (in longgrain) from last month, and a decrease of 11 percent from the previous year record.

The decrease in the 2011/12 domestic and residual use is based in part on the March 1 Rice Stocks report released by the National Agricultural Statistics Service (NASS) on March 30. The all rice 2011/12 season average farm price is forecast at $13.80 to $14.20 per cwt, down 10 cents on the low end and a decrease of 30 cents on the high end.

SUGAR: Projected U.S. sugar supply for fiscal year 2011/12 is decreased 250,000 tons, raw value, from last month, due to lower imports more than offsetting higher production. Beet sugar production is raised 130,000 tons to reflect the higher sugarbeet area in the March 2012 Prospective Plantings report. Imports from Mexico are reduced 385,000 tons, while high-tier tariff imports are raised 5,000 tons. Mexico's sugar production is reduced and domestic consumption is raised, both in line with their respective pace. Mexico's ending stocks are raised to reflect Mexico's assumed stock needs relative to consumption.

RED MEAT and POULTRY: The 2012 forecast of total red meat and poultry production is raised from last month. Beef production is forecast slightly higher as higher midyear production is largely offset by lower-than-expected slaughter in the first quarter. The pork production forecast is raised as the March Quarterly Hogs and Pigs report pointed to a slightly higher-than-expected first-quarter pig crop.

Turkey production is forecast higher as turkey price forecasts are raised. The egg production forecast is raised slightly.

The beef export forecast for 2012 is lowered, reflecting the current pace of trade. Imports are raised on larger expected supplies in Oceania. Pork exports are raised.

The cattle price for 2012 is lowered from last month based on weaker forecast second-quarter prices. The 2012 hog price is lowered based on revised first-quarter prices and a slightly weaker forecast for prices over the middle quarters. Broiler and turkey price forecasts are raised as current prices remain strong. Egg price forecasts are raised on stronger expected midyear prices.

The milk production forecast for 2012 is raised on increased milk cow numbers and gains in milk per cow.

COTTON: This month's 2011/12 U.S. cotton supply and demand estimates include lower production and higher exports, resulting in a decrease of 500,000 bales in forecast ending stocks.

Production is reduced 119,000 bales based on USDA's Cotton Ginnings report, released March 23, 2012, while exports are raised 400,000 bales, reflecting very strong shipments in recent weeks. Domestic mill use is unchanged. Ending stocks are now forecast at 3.4 million bales, equivalent to an ending stocks-to-use ratio of 23 percent. The forecast range for the average price received by producers of 89 to 93 cents per pound is raised 1 cent on the lower end.

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