U.S. Corn Inventory Drops Less Than Expected as Livestock-Feed Use Eases
Pre-harvest corn inventories in the U.S., the world’s biggest grower and exporter, fell 34 percent from a year earlier, less than analysts forecast as livestock producers used more wheat in feed rations.
Stockpiles on Sept. 1 totaled 1.128 billion bushels, down from 1.708 billion a year earlier, the U.S. Department of Agriculture said today in a report. Analysts in a Bloomberg News survey expected 942 million, on average. Corn usage in the three months ended Aug. 31 was 2.54 billion bushels, down from 2.6 billion a year earlier, the USDA said.
“U.S. livestock producers are substituting more wheat in livestock rations,” Dale Durchholz, a senior market analyst at AgriVisor LLC in Bloomington, Illinois, said before the report. “Increased wheat feeding outside of the U.S. may slow export demand for corn in the coming months.”
Corn futures have gained 25 percent in the past year on the Chicago Board of Trade, partly on concern that hot, dry weather damaged crops. The USDA earlier this month predicted a harvest of 12.497 billion bushels (328.1 million metric tons), up 0.4 percent from last year and down from 12.914 billion forecast in August.
An estimated 15 percent of the crop was collected as of Sept. 25, down from 26 percent a year earlier and the previous five-year average of 16 percent, the USDA said this week. Mostly dry weather will aid harvesting the next 10 days, T- Storm Weather LLC said yesterday.
Corn futures for December delivery rose 1.75 cents, or 0.3 percent, to close at $6.325 a bushel yesterday on the CBOT. The most-active contract touched $6.23, the lowest price since July 12.
“The biggest price factor for corn over the next month will be the size of the upcoming harvest,” AgriVisor’s Durchholz said before the report. “As prices moved lower the past month, that may have improved demand for corn.”
Soybean inventories on Sept. 1 totaled 215 million bushels, down from 225 million estimated on Sept. 12 and up from the 151 million bushels a year earlier, the USDA said. The average analyst estimate was 224 million bushels.
Consumption of the oilseed in the final quarter of the marketing year that ended Aug. 31 fell to 405 million bushels from 420 million a year earlier, the USDA said.
“No one is going begging for soybean supplies,” Bill Nelson, a senior economist at St. Louis-based Doane Advisory Services Co., said before the report. “Supplies in South America are the second-highest ever and people are shifting their focus to the start of the planting season this month in Argentina and Brazil.”
Soybean futures for November delivery rose 6.5 cents, or 0.5 percent, to settle at $12.30 a bushel yesterday on the Chicago, after touching $12.0925, the lowest level since Nov. 23. Before today, the commodity tumbled 16 percent this month on speculation that Europe’s debt crisis will escalate and reduce global commodity demand.
The U.S. harvest will total 3.085 billion bushels of soybeans, down from 3.329 billion in 2010, the USDA said in a Sept. 12 report. The agency will update its forecasts for corn and soybean production on Oct. 12.
Corn is the biggest U.S. crop, valued at $66.7 billion in 2008, followed by soybeans at $38.9 billion, government data show. The U.S. is also the world’s largest producer and exporter of soybeans, followed by Brazil and Argentina.
To contact the editor responsible for this story: Steve Stroth in Chicago at email@example.com.