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USDA Continues to Lower Its Corn Stock Estimates

Increased corn exports are continuing to draw down stocks, according to the USDA's World Agricultural Supply and Demand Estimates issued Monday. For the third consecutive month, the USDA has lowered its assessment of U.S. corn stocks. The April estimate of 58.45 million metric tons (2.3 billion bushels) of corn stocks is more than 3 million tons (124.8 million bushels) below January's estimate of 61.62 million tons (2.4 billion bushels).

"The United States is expected to capture an increasing share of the growing world demand for coarse grains," notes Ken Hobbie, U.S. Grains Council president and CEO. "Strong export demand in Asia, combined with decreased exports by both Argentina and China in recent months, is good news for U.S. corn producers."

With China out of the export market, Korea and countries in Southeast Asia are looking to the United States for needed feed grain supplies.

The growth in exports has boosted the low range of price projections for corn to $1.95 per bushel this month, compared to $1.85/bu in February and March. This 10 cent/bu increase means an additional estimated $1.1 billion will flow into the U.S. feed grains economy this year. The high end of the range remained steady at $2.05/bu.

In addition, U.S. sorghum is enjoying increased demand, particularly in Mexico. Two factors are contributing to sorghum's popularity there, according to Ricardo Celma, USGC director for Mexico and Central America. Mexico's regular corn import quota has already been used by most feed grain importing companies and sorghum is currently priced more favorably than either processed or whole corn. Rising exports have decreased sorghum stock estimates by 15 million bushels. The price range for sorghum has increased 5 cents on the low end, putting price estimates at $1.70-$1.80/bu.