Although last week's USDA Crop Production report estimates corn production 1% lower than the previous month, 2011-2012 beginning stocks were estimated higher based on a projected reduction in corn use. The monthly World Agriculture Supply and Demand Estimates (WASDE) pegs the season average farm price at $6.20-$7.20/bu. That's 30¢ lower on both ends of the range compared to the previous month.
Reflecting on the USDA Grain Stocks report on Sept. 30 and this week's WASDE, analysts with the USDA Economic Research Service (ERS) explain in last week's Feed Outlook, "…The stocks (corn) data and nearly final data for other domestic use and trade imply a fourth-quarter feed and residual use of only 448 million bu., the lowest quarterly corn feed use going back as far as comparable data are available (1975/76). However, annual feed and residual for 2010-2011, at 4.80 billion bu., is neither unusually large nor unusually small, coming in as the 17th largest in the last 35 years even as the use of distillers' dried grains has slowed the direct use of corn for feed."
Among the possible explanations for the record low quarterly feed and residual use of corn, ERS analysts cite the impact of higher prices on usage, early usage of new-crop 2011-2012 corn, a tighter pipeline (in transit) supplies, and higher quality of the 2010-crop corn compared with 2009-crop.
"Although none of these potential explanations are definitive and even together may not fully explain all of the reduction year-to-year in feed and residual disappearance during the last half of the 2010-2011 marketing year, these factors do merit some discussion," the analysts say.
For the week ending Oct. 9, according to the National Agricultural Statistics Service:
Corn – 89% is mature, compared to 97% last year and 88% for average. 33% has been harvested, compared to 50% last year and 32% for average. 53% is in Good or Excellent condition, compared to 68% a year ago. 19% is rated Poor or Very Poor, compared to 11% a year ago.
Soybeans – 90% are dropping leaves, 4% less than last year and 2% less than the average. 51% has been harvested, 12% less than last year, but 5% more than average. 56% is in Good or Excellent condition; 64% was last year.
Sorghum – 91% is coloring, 9% less than last year and 4% less than the average. 63% is mature, 24% less than last year and 10% less than the average. 37% is harvested, 13% less than last year and 6% less than average. 25% is in Good or Excellent condition; 60% was last year.
Winter wheat – 59% is planted, compared to 69% last year and 67% for average. 28% has emerged, compared to 37% last year and 38% for average.
Pasture – 30% of the nation’s pasture and range is rated as Good or Excellent, 12% less than at the same time last year. 42% is rated Poor or Very Poor, compared to 26% a year ago.