Global corn production for 2011-2012 is projected at a new record high of 867.5 million tons, despite a 3.5-million-ton decline year-to-year in the U.S. Foreign corn production is expected to be up 43.4 million tons from 2010-2011. China 2011-2012 production is raised 7.3 million tons this month based on the recently released estimate from the National Bureau of Statistics. Slightly higher area and a 3% increase in yields from the previous forecast boost this year’s crop to a record 191.8 million tons. This year’s yield estimate is up 3% (3 bu./acre) from the previous record in 2008-2009 and up 9% (8 bu.) from the recent low in 2009-2010. Weather was generally favorable for this year’s crop; record yields were reported despite summer conditions in the northeast growing areas that were somewhat warmer and drier than in 2008-2009. Corn production is also raised 1.0 million tons for EU-27 and 0.7 million tons for Canada based on the latest government reports.
U.S. feed grain ending stocks for 2011-2012 are projected slightly higher with a small decrease in domestic corn use and a small increase in oats imports. Corn food, seed and industrial use is lowered 5 million bushels with early marketing-year corn use for sweeteners down slightly year on year. Projected corn ending stocks rise 5 million bushels to 848 million.
The 2011-2012 season-average farm price for corn is projected 30¢ lower on each end of the range to $5.90-6.90/bu. Corn prices received by producers have been reported 40-50¢/bu. below prevailing cash market bids reflecting apparent deliveries of grain that was forward priced below $6/bu. ahead of planting this past spring. Declines in futures prices since early November have also tempered the outlook for seasonal price gains over the coming months.
Global coarse grain supplies for 2011-2012 are projected 7.4 million tons higher as lower beginning stocks for corn and barley are more than offset by an 8.5-million-ton increase in corn production, mostly reflecting higher output from China. Global corn beginning stocks for 2011-2012 are reduced 0.8 million tons, with a downward revision to 2010-2011 production for South Africa.
World coarse grain trade for 2011-2012 is mostly unchanged this month with corn and sorghum imports and exports down slightly, but partly offset by small increases for barley. Corn imports are lowered 0.5 million tons for EU-27 with the larger crop and lower expected shipments from Serbia. Global corn consumption is raised mostly reflecting a 2.0-million-ton increase in China corn feeding. Global corn ending stocks are projected 5.6 million tons higher, mostly on increased stocks in China. At the projected 127.2 million tons, world ending stocks remain at a five-year low.
U.S. feed grain ending stocks for 2011-2012 are projected slightly higher with a small decrease in domestic corn use and a small increase in oats imports. Corn food, seed and industrial use is lowered 5 million bushels with early marketing-year corn use for sweeteners down slightly year on year. Projected corn ending stocks rise 5 million bushels to 848 million.
The 2011-2012 season-average farm price for corn is projected 30¢ lower on each end of the range to $5.90-6.90/bu. Corn prices received by producers have been reported 40-50¢/bu. below prevailing cash market bids reflecting apparent deliveries of grain that was forward priced below $6/bu. ahead of planting this past spring. Declines in futures prices since early November have also tempered the outlook for seasonal price gains over the coming months.
Global coarse grain supplies for 2011-2012 are projected 7.4 million tons higher as lower beginning stocks for corn and barley are more than offset by an 8.5-million-ton increase in corn production, mostly reflecting higher output from China. Global corn beginning stocks for 2011-2012 are reduced 0.8 million tons, with a downward revision to 2010-2011 production for South Africa.
World coarse grain trade for 2011-2012 is mostly unchanged this month with corn and sorghum imports and exports down slightly, but partly offset by small increases for barley. Corn imports are lowered 0.5 million tons for EU-27 with the larger crop and lower expected shipments from Serbia. Global corn consumption is raised mostly reflecting a 2.0-million-ton increase in China corn feeding. Global corn ending stocks are projected 5.6 million tons higher, mostly on increased stocks in China. At the projected 127.2 million tons, world ending stocks remain at a five-year low.
High consumption of corn commodity make China import corn about 7 million tons in 2012-2013 after 4 million metric tons in 2011-2012. Soybean imports will likely rise 12% on year in 2011-12 to 58.5 million tons under a baseline scenario, and by 15% or more to exceed 60 million tons in best-case.
Sleeping in China Economy next year is unlikely to weaken the country's agricultural demand, since the government can secure global supplies to replenish low domestic inventories. As inflation eases and crush margins improve, Rabobank forecast a rebound in China palm oil demand in 2011-12, up 5% to a record 6 million tons.
In the U.S., Corn basis levels at the U.S. Gulf slipped 3 cents for the spot month. Soybean Gulf basis levels, however, jumped 1 to 5 cents versus futures, according to U.S. Department of Agriculture data. Cash grain markets remain strong versus futures prices, but could begin to soften as grain begins to move more freely.
A lack of farmer selling has boosted cash market prices and limited losses in futures throughout the fall. Expectations that prices could go higher and farmers' stable financial positions after a year of sharply higher crop prices have encouraged farmers to hold on to supplies.
In first week December 2011 Cash corn's Chicago Board of Trade futures shrunk to 8 1/2 cents, from 11 1/2 cents at the start of the week, according to a national cash grain index maintained by the Minneapolis Grain Exchange. Cash soybeans' discount to January CBOT futures shrunk 1 1/2 cents during that time period, to 43 1/2 cents.
Sleeping in China Economy next year is unlikely to weaken the country's agricultural demand, since the government can secure global supplies to replenish low domestic inventories. As inflation eases and crush margins improve, Rabobank forecast a rebound in China palm oil demand in 2011-12, up 5% to a record 6 million tons.
In the U.S., Corn basis levels at the U.S. Gulf slipped 3 cents for the spot month. Soybean Gulf basis levels, however, jumped 1 to 5 cents versus futures, according to U.S. Department of Agriculture data. Cash grain markets remain strong versus futures prices, but could begin to soften as grain begins to move more freely.
A lack of farmer selling has boosted cash market prices and limited losses in futures throughout the fall. Expectations that prices could go higher and farmers' stable financial positions after a year of sharply higher crop prices have encouraged farmers to hold on to supplies.
In first week December 2011 Cash corn's Chicago Board of Trade futures shrunk to 8 1/2 cents, from 11 1/2 cents at the start of the week, according to a national cash grain index maintained by the Minneapolis Grain Exchange. Cash soybeans' discount to January CBOT futures shrunk 1 1/2 cents during that time period, to 43 1/2 cents.
