June 25—USDA’s June supply and demand report showed a shocking reduction of corn carry out in both old and new crop. The reduction was 135 million bushels in old crop and 245 million bushels in new crop, due mostly to an increase in ethanol demand. In the next marketing year corn demand for ethanol is expected to be 4.70 billion bushels. Estimates call for an additional 1,350 thousand tons of dried distillers of production in this marketing year.

USDA estimated the food, seed and industrial use for the current and the new marketing year will be 5.890 billion and 6.060 billion bushels respectively. The large increase comes from ethanol demand, boosted by 150 million bushels this year and 100 million bushels in the new marketing year. Glucose/dextrose and starch are expected to increase corn demand by 5 million bushels in both old crop and new crop, 255 million bushels next year compared to 250 million bushels this year and 245.03 million bushels the year prior. Starch is expected to consume 245 million bushels versus 240 million bushels this year and 234.05 million bushels in 2008-’09. High fructose corn syrup is expected to consume 505 million bushels of corn, up 5 million bushels from the year prior and compared to 489.17 million bushels in 2008-’09. A marketing year runs from September through August.

The following chart/table illustrates historic U.S. corn ending stocks and stocks to use ratio. With new crop carry-out dropping to 1.573 billion bushels, the carry-out to use ratio dropped to 11.7 percent, the lowest level since 2006-’07.