U.S Corn stocks even tighter, more rationing ahead

U.S. ending stocks for corn and soybeans declined further from last month, based on projected lower yields and continued strong demand, according to USDA’s monthly update of last year’s crops. In its January. 12 Crop Production Report and World Agricultural Supply and Demand Estimates, USDA also raised projected U.S. production for cotton and rice.

In a Minneapolis Grain Exchange press briefing on the report, Peter Georgantones, Abbott Futures, said the competition for acres between corn, cotton, wheat and soybeans this spring is bound to push prices higher. With the lowering of corn yield and very low stocks numbers, “there is going to have to be a rationing process taking place in corn. That’s why we’re at US$6.25 now, but I think we’re going to have to ration more. We’ll have to fight for acres with other commodities.”

Estimated U.S. corn production is 93 million bushels lower based on a 1.5-bushel-per-acre reduction in the national average yield, according to USDA. Corn used for ethanol was raised 100 million bushels due to record ethanol production in December. Projected corn ending corn stocks for 2010-11 were lowered 87 million bushels to 745 million, down 963 million bushels from last year. The stocks-to-use ratio is projected at 5.5 percent, the lowest since 1995-96 when it dropped to 5 percent. Read more...


This blog is written by Martin Little The Global Miller, published and supported by the GFMT Magazine from Perendale Publishers.