USDA WASDE April report pegs corn use for ethanol higher

By Ann Bailey | April 12, 2016

Judging by weekly ethanol production through March 2016, 25 million more bushels of corn will be used for making the biofuel in the 2015-2016 corn marketing year than previously was estimated, USDA said in its April World Supply and Demand Estimate.

The marketing year for corn and sorghum began Sept. 1, 2015, and runs through Aug. 31. The stronger-than-expected pace of weekly ethanol production was reported by the U.S. Energy Information Administration, USDA noted.

The agency pegged corn use for ethanol and byproducts at 5.25 billion bushels, up from its March estimate of 5.225 billion bushels. USDA, however, reduced its estimate of corn feed and residual by 50 million bushels in the April report. In March, USDA estimated in the 2015-2016 marketing year corn feed and residual usage would be 5.3 billion bushels. The agency pegged the usage would be 5.25 billion in the April report.

USDA raised the amount of corn it expects to be on hand at the end of the marketing year by 25 million bushels to 1.862 billion bushels in the April WASDE report. The March report pegged corn ending stocks at 1.837 billion bushels.

In the April WASDE report, USDA dropped the projected season average farm price for corn by a nickel at the midpoint to $3.55 per bushel.

 Strong use of sorghum during February 2016 to make ethanol, as reported in the Grain Crushings and Co-Products Production report, resulted in a 25 million bushels increase in USDA’s estimate of the coarse grain crops food, seed and industrial use from March to April.

USDA estimated in the April WASDE report food seed and industrial use of sorghum would be 125 million bushels. In March, the agency had pegged food, seed and industrial use at 100 million bushels.  USDA estimated the sorghum farm price range at the midpoint would be $3.20 per bushel, 10 cents lower.