USDA lowers corn harvest but increases yield estimates
© Copyright Agri-Pulse Communications, Inc.
WASHINGTON, Jan. 11, 2013- The World Supply and Demand Estimates (WASDE) released by USDA today adjusted feed grain supply estimates higher for the 2012/2013 season due to estimated increases in corn yield.
Harvested area for corn is lowered 346,000 acres, but a 1.1-bushel-per-acre increase in the estimated yield boosts production 55 million bushels, noted the report, while sorghum harvested area is nearly unchanged, but a decrease in the estimated yield lowers production 9 million bushels.
The WASDE notes that corn ending stocks are projected 44 million bushels lower at 602 million, while the season-average farm price for corn is unchanged at $6.80 to $8.00 per bushel. Feed and residual use for corn is projected 300 million bushels higher based partly on higher expected beef, pork, and poultry production, according to the report.
Corn exports are projected 200 million bushels lower “reflecting the slow pace of sales and shipments to date and increasing pressure from larger supplies and exports for South America.”
Corn ending stocks are projected 44 million bushels lower at 602 million and the season-average farm price for corn is unchanged at $6.80 to $8.00 per bushel.
“While stiff competition has limited U.S. corn exports, higher domestic disappearance leaves the balance sheet historically tight and is expected to support continued strong and volatile prices well into summer, particularly in the domestic cash markets,” noted the report.
Global coarse grain supplies for 2012/13 are projected 2.9 million tons higher mostly reflecting the larger U.S. corn crop and increased corn production for South America.
Brazil corn production is raised 1.0 million tons on higher expected yields with favorable December rainfall across the southern growing areas. Argentina corn production is raised 0.5 million tons as lower harvested area is offset by higher expected yields.
The WASDE report also noted that larger crops for soybeans, sunflowerseed, and peanuts are partly offset by reductions for canola and cottonseed.
Soybean production is estimated at 3.015 billion bushels, up 44 million bushels based on increased yields and harvested area.
The soybean yield is estimated at 39.6 bushels per acre, up 0.3 bushels from the previous estimate. Soybean crush is raised 35 million bushels to 1.605 billion bushels reflecting higher projected domestic soybean meal consumption and increased soybean meal exports.
However, soybean exports are unchanged at 1.345 billion bushels. Soybean ending stocks for 2012/13 are projected at 135 million bushels, up 5 million from last month.
The Brazilian government announced that the latest soybean crop, Brazil's highest yielding commodity, will have a 24.5 percent increase over the previous harvest.
"We will be the world's largest producer of soybeans for the first time ever, thanks in part to federal government incentives through policies that have facilitated access to credit for producers,” according to Secretary of Agricultural Policy of MAPA, Neri Geller.
According to WASDE, global soybean production is projected at 269.4 million tons, up 1.7 million with gains in the United States and Brazil partly offset by a lower projection for Argentina. The Brazil soybean crop is increased 1.5 million tons to a record 82.5 million reflecting record area and improving yield prospects. According to USDA, “higher projected yields are the result of favorable moisture throughout the center west and southern growing areas.”
The projected range for the U.S. 2012/13 season-average soybean price is lowered 30 cents at the midpoint and narrowed to $13.50 to $15.00 per bushel.
For U.S. wheat, projected ending stocks for 2012/13 are lowered 38 million bushels this month.
Exports for all wheat are unchanged, but Hard Red Winter (HRW) wheat exports are lowered 25 million bushels and Soft Red Winter (SRW) wheat exports are raised 25 million bushels based on the pace of sales and shipments to date and the increasing competitiveness of SRW wheat in world markets, noted the report.
Global wheat supplies for 2012/13 are projected slightly lower based on reduced production prospects in Argentina and lower reported production in Russia, noted WASDE. Argentina production is reduced 0.5 million tons with lower expected harvested area and yields and Russia production is lowered 0.3 million tons based on the latest government reports.
The projected range for the 2012/13 season-average farm price for all wheat is lowered 10 cents at the midpoint and narrowed to $7.65 to $8.15 per bushel.
Additionally, the milk production forecast for 2012 is increased based on a slower decline in cow numbers and greater output per cow in the fourth quarter. Milk production for 2013 is raised as the decline in cow numbers is dampened from last month.
Butter and cheese prices for 2013 are lowered based on current price weakness and weaker expected demand. The all milk price forecast is lowered to $18.85 to $19.65 per cwt.
View the entire report here.
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