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USDA raises estimates for 2017-18 US, global ending corn stocks

Houston (Platts)--12 Jan 2018 443 pm EST/2143 GMT


The US Department of Agriculture on Friday raised its estimate for US ending corn stocks at the end of the 2017-18 marketing year to 2.447 billion bushels (62.919 million mt), up 40 million bushels from its December projection of 2.437 billion bushels.

This would be 184 million bushels above its estimate for the 2016-2017 marketing year. Each marketing year starts September 1. The rise in US corn ending stocks was because USDA increased its estimates of corn yield to a record 176.6 bushels/acre, which partially offset the reduction in harvested area estimated.

Although the US ending stock estimates were within the range of market expectations, it was above the average of analyst estimates, a market participant said.

USDA did not change its estimates of US corn to be used for ethanol production, still seen at 5.525 million bushels, and for US corn exports, expected to remain at 1.925 billion bushels (48.898 million mt).

The updated estimate foresees 38.18% of the current season's crop going toward production of ethanol and byproducts, while 13.3% would be exported.

The department increased its projection for global ending corn stocks at the end of the 2017-18 marketing year to 206.57 million mt, up 2.49 million mt from its December projection. This would be 22.18 million mt below its estimate for the 2016-2017 marketing year.

"Foreign corn ending stocks are higher than last month, mostly reflecting increases for Brazil and Pakistan," the USDA said.

Despite the rise on ending stocks estimates, USDA is projecting a 5-cent rise in its midpoint season average price for the 2017-2018 marketing year to $3.25/bushel, "based on observed prices to date," the agency said.

Corn is the primary feedstock for ethanol production in the US and is the main competitor for dried distillers grains.

--Sergio Alvarado, sergio.alvarado@spglobal.com --Edited by Annie Siebert, ann.siebert@spglobal.com




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