WASDE: Corn, soybean outlook

By Dave Natzke

With the numbers digested from the 2012 Prospective Plantings report on March 30, further analysis of potential 2012 crops and prices is underway. USDA’s World Ag Supply & Demand Estimates (WASDE) report, released April 10, points to little change in the corn outlook, but reduces anticipated soybean supplies.

 

For dairy producers buying feed, USDA narrowed the range for the season-average (2011-12) corn price forecast (paid to growers), at $6.00-$6.40/bushel. That compares to $5.18/bushel in 2010-11 and $3.55/bushel in 2009-10.

 

The projected 2011/12 U.S. season-average soybean price was raised to $12.00-$12.50/bushel, up 25¢ on the mid-range forecast from last month. That compares to $11.30/bushel in 2010-11 and $9.59/bushel in 2009-10.

 

Soybean meal prices were forecast at $335-$355/ton, up $20 on the mid-range. That compares to $345.50/ton in 2010-11 and $311.25/ton in 2009-10.

 

Corn outlook

U.S. 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 U.S. 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. 

 

The quick start to corn planting this spring and more intended acres across the South raises the potential for a substantial increase in new-crop corn use before the Sept. 1 start of the new marketing year.

 

Global 2011/12 corn production is nearly unchanged compared to a month ago, with changes in individual countries offsetting each other. Corn production projections were raised in Egypt, Indonesia, Cambodia, Colombia and Thailand; estimates were reduced for Mexico, Argentina, South Africa, Venezuela and Laos. 

 

Global coarse grain imports and exports for 2011/12 were raised slightly, with several countries adjusted based largely on the pace of trade to date. A 0.5-million-ton increase for Brazil corn exports is partly offset by a 0.1-million-ton decrease in corn exports for Mexico. Corn imports were lowered for Egypt, Thailand and Colombia, but raised for Mexico, Indonesia and Venezuela.

 

Corn feeding was reduced for Mexico and Brazil, but raised for Indonesia and Egypt. 

 

Soybean outlook

U.S. soybean exports for 2011/12 were increased 15 million bushels this month, to 1.29 billion bushels. The increase partly offsets reduced export prospects for South America, resulting from drought-reduced soybean crops. 

 

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 were projected at 250 million bushels, down 25 million from last month.

 

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 were further reduced this month, reflecting the damaging effects of this year’s drought. 

 

Global oilseed trade for 2011/12 is projected at 106.4 million tons, down 2 million mainly reflecting reduced soybean trade. Lower soybean exports were forecast for Argentina, Brazil, Paraguay and Uruguay. Soybean imports were reduced for Vietnam, Iran, and Mexico.

 

Global soybean ending stocks were projected at 55.5 million tons, down 1.8 million from last month, and down 13.6 million tons from last year.

 

To see the full WASDE report, visit www.usda.gov/oce/commodity/wasde/latest.pdf.