The USDA's National Agricultural Statistics Service (NASS) has released new forecasts of the size of the 2013 corn and soybean crops. In addition, the USDA's World Agricultural Outlook Board released updated forecasts of the supply and consumption of those crops for the 2013-2014 marketing year. The reports contained no major surprises, confirming large crops, improved exports and prospects for larger year ending stocks and lower prices.

Corn

NASS now forecasts the U.S. average corn yield at 160.4 bushels per acre, compared to the September forecast of 155.3 bushels. As expected, based on preliminary estimates of certified acreage by the USDA's Farm Service Agency, the estimate of planted acreage was reduced by 2.038 million acres and the estimate of acreage harvested for grain was reduced by 1.9 million acres. The new estimates point to a record crop of 13.989 billion bushels, 146 million larger than the September forecast. The forecast of corn production in the rest of the world was increased by 97 million bushels, with lower projections for Brazil and Mexico and a larger estimate for Russia.

The forecast of current marketing year feed and residual use of corn was increased by 100 million bushels to a six-year high of 5.2 billion bushels. The projection is 867 million bushels (20%) larger than use of a year ago. The large increase reflects the lower price of corn, some increase in poultry and perhaps hog production, and an expected large increase in residual use associated with a large crop. The projection is optimistic. The first indication of the pace of consumption will come with the estimate of December 1stocks to be released in the second week of January.

 

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The projection of marketing year exports was increased by 175 million bushels, to a total of 1.4 billion bushels. That projection is nearly double exports of the past year which were at a 42 year low. The larger projection this month reflects the competitiveness of U.S. corn prices in the world market and the pace of exports and export sales to date.

Stocks of corn at the end of the marketing year are projected at an eight year high of 1.887 billion bushels, 32 million larger than projected in September and 1.063 billion larger than stocks at the beginning of the year. The marketing year farm price is projected in a range of $4.10 to $4.90, the lowest in four years and $0.30 lower than projected in September.