Corn to yield 171.7 bu/acre for record 14.4 billion bushel crop

By Susanne Retka Schill | September 11, 2014

The USDA boosted its corn yield forecast by 4.3 bushels per acre to a record 171.7 bushels, projecting corn production at a record 14.395 billion bushels, 368 million bushels higher than last month’s supply/demand report. That puts projected 2014/15 corn supplies at 15.607 billion bushels, up 825 million bushels from the previous record in 2013/14.

Corn usage is projected higher as well at 13.605 billion bushels, up 170 million bushels from the previous month’s report. Although a record, usage is expected up just 5 million bushels from 2013/14 as export prospects remain constrained by large foreign carryin stocks. Feed and residual use for 2014/15 is projected 75 million bushels higher this month with the larger crop and lower prices. Projected food, seed and industrial use is raised 70 million bushels with increases expected for both ethanol and sweeteners. Increases are supported by the reduced corn price outlook and higher production of these corn-based products in recent months. Ethanol use is projected to use 5.125 billion bushels, equal to the estimated use during 2013/14, the marketing year that just closed.

Corn exports are projected 25 million bushels higher with lower prices and reduced competition expected from South America later in the marketing year. Projected U.S. corn ending stocks are raised 194 million bushels to 2,002 million and would be the highest since 2004/05. The projected season-average corn farm price is lowered 40 cents at the midpoint to $3.20 to $3.80 per bushel.

The Renewable Fuels Association congratulated U.S. farmers for what is likely to be the fifth record-breaking corn crop in that past 12 years. “The innovation and rapid technology adoption we’ve seen in the corn sector over the past decade has been nothing short of astounding,” said Bob Dinneen, president and CEO, in a statement. The American farmer has again risen to the challenge to meet all demands for feed, food and fuel.” Dinneen warned, however, that the U.S. EPA’s proposed reduction in 2014 renewable fuel standard volumes could reduce the requirement from 14.4 billion gallons of renewable fuel to 13.01 billion gallons, which would potential reduce demand for corn by about 500 million gallons.

The USDA’s Sept. 11 supply/demand report went on to look at global supplies where a projected reduction in foreign coarse grain production is being offset by the higher U.S. corn production forecast as well as higher beginning stocks. Most of that increase reflects lower 2013/14 EU corn and barley use and higher corn imports. Adding to available EU grain supplies for 2014/15 is a combined increase of 2.1 million tons in corn and barley output. Brazil corn production is also raised 1.0 million tons for 2014/15 with a month-to-month increase in expected area reflecting the higher area and production reported for 2013/14. Serbia corn production is raised 0.3 million tons for 2014/15.

Corn production for 2014/15 is reduced elsewhere with the largest reduction for China where output is expected down 5 million tons based on persistent summer dryness in key growing areas of the North China Plain and Northeast. Argentina corn production is lowered 3.0 million tons for 2014/15 with lower expected plantings, but higher reported yields boost 2013/14 production 1.0 million tons. Hot, dry conditions in Ukraine and Russia reduce 2014/15 corn production prospects by 1.0 million tons and 0.5 million tons, respectively.

Global coarse grain consumption for 2014/15 is raised 2.3 million tons as higher U.S. consumption is partly offset by a reduction in foreign corn use. Higher expected corn exports for the United States, EU and Serbia mostly offset an expected reduction for Argentina. Higher 2013/14 Argentina and Brazil local marketing-year (March 2014-February 2015) exports are expected to limit opportunities for U.S. exports during the early months of the 2014/15 U.S. marketing year (September-August); however, lower year-to-year 2014/15 production and exports for Argentina and Brazil are expected to reduce competition for U.S. shipments during the second half of the 2014/15 September-August marketing year. Global corn ending stocks for 2014/15 are projected 2.1 million tons higher with reductions for China, Argentina and Russia more than offset by the larger stocks for the United States and Brazil.