U.S. feed grain ending stocks for 2014/15 are projected lower with reductions for corn and barley. Corn use in ethanol production is projected 50 million bushels lower based on the new Grain Crushings and Co-Products Production report recently released by the National Agricultural Statistics Service (NASS).

Reported corn use for ethanol for October through January implies a higher conversion rate than previously assumed. Partly offsetting the impact of the higher conversion rate is higher-than-expected December ethanol production and a stronger-than-expected pace of weekly production through February as reported by the Energy Information Administration. The reduction in corn use for ethanol is offset by a 50-million-bushel increase in projected feed and residual use. Thus, expected total domestic disappearance is unchanged. Corn exports are projected 50 million bushels higher based on commitments to date and higher projected global demand. Projected ending stocks are lowered 50 million bushels. The season-average farm price for corn is projected at $3.50 to $3.90 per bushel, up 5 cents at the midpoint.

Revisions to estimated 2014/15 first-quarter (September-November) corn use in ethanol production, based on the Grain Crushings and Co-Products Production data for October and November, will be detailed in the March 12 Feed Outlook available from the Economic Research Service at www.ers.usda.gov/topics/crops/corn.aspx.

U.S. barley ending stocks for 2014/15 are projected 4 million bushels lower with imports lowered 2 million bushels and exports raised 2 million bushels based on the pace of shipments to date. The projected barley farm price range is narrowed and raised 10 cents at the midpoint to $5.20 to $5.50 per bushel. The sorghum farm price projection is also narrowed and raised 10 cents at the midpoint to $3.70 to $4.10 per bushel. Both increases reflect farm prices reported through January.

Global coarse grain supplies for 2014/15 are projected 2.4 million tons lower mostly on reduced corn beginning stocks and production for South Africa. Upward revisions to 2005/06 through 2009/10 South Africa corn consumption lower estimated stocks over the last decade and cause a 2.2-million-ton reduction in 2014/15 beginning stocks. A 1.0-million-ton increase in Brazil beginning stocks is partly offsetting with 2013/14 production raised 0.5 million tons and exports lowered 0.5 million tons. Argentina corn exports are raised 0.5 million tons for 2013/14.

Global corn production for 2014/15 is lowered 1.6 million tons with reductions for South Africa and Belarus only partly offset by an increase for Argentina. South Africa corn output is lowered 2.0 million tons as February dryness and periodic heat, particularly in the western and central corn growing regions, coincided with corn pollination.

Corn production is lowered 0.1 million tons for Belarus based on indications of lower harvested area from the Ministry of Agriculture. Argentina corn production is raised 0.5 million tons as a small reduction in harvested area due to recent flooding is more than offset by higher expected yields with abundant soil moisture available for pollination and grain fill in other areas. Developing dryness in southern growing areas, however, limits this month’s yield increase.

Other coarse grain production changes for 2014/15 include a 0.5-million-ton increase for India millet, a 0.4-million-ton increase for Australia barley, and 0.2-million-ton increases for both Belarus barley and rye.

Global coarse grain consumption for 2014/15 is raised 2.7 million tons mostly on higher barley use for China with larger imports and higher millet use for India with larger production. Barley consumption and imports are also raised for Iran. Partly offsetting the increases in barley imports for China and Iran is a reduction for Saudi Arabia. Barley exports are raised for EU and Australia. Corn imports are raised for Saudi Arabia and Israel.

In addition to the United States, corn exports are raised for Argentina and Brazil, more than offsetting a reduction for South Africa. Global coarse grain ending stocks for 2014/15 are lowered 5.0 million tons with corn ending stocks down 4.4 million. Projected foreign corn ending stocks are lowered 3.1 million tons with reductions for South Africa and Argentina.

Source: USDA, World Agricultural Supply and Demand Estimates report released on Mar. 10, 2015