WASDE: Corn use for ethanol reduced to 3.375 billion bushels

By Erin Voegele | November 11, 2019

The USDA lowered its 2019-’20 forecast for corn use in ethanol by 25 million bushels in its latest World Agriculture Supply and Demand Estimates Report, released Nov. 8. The forecasts for corn production, use and ending stocks were also reduced.

The USDA currently forecasts corn production at 13.661 billion bushels, down 118 million when compared to the last month on a 1.4-bushel reduction in yield to 167 million bushels per acre. Feed and residual use is down 25 million bushels based on a smaller crop and higher expected prices. Exports are reduced reflecting the slow pace of early-season sales and shipments.

Corn use for ethanol for 2019-’20 is now forecast at 5.375 billion bushels, down from 5.4 billion bushels forecast in October. An estimated 5.376 billion bushels of corn went to ethanol production in 2018-’19, down from 5.605 billion bushels in 2017-’18. The forecasted reduction for 2019-’20 is based on September data from the USDA’s Grain Crushing and Co-Products Production report and weekly ethanol production data as reported by the U.S. Energy Information Administration for the month of October.

With supply falling more than use, corn ending stocks are lowered 18 million bushels from last month. The season-average corn price received by producers is raised 5 cents to $3.85 per bushel based on observed prices to date.

Foreign corn production is forecast higher as increases for several African countries, Russia and Turkey more than offset declines for Mexico, Ukraine and the European Union. For Mexico, production is lowered as area for summer season corn is expected to be the lowest on record. Yield forecasts for Russia and Ukraine are raised and lowered, respectively, based on observed harvest results to date.

Corn exports are raised for Brazil and Russia, with reductions for the United States and Mexico. For 2018-’19, corn exports for Brazil are raised for the local marketing year beginning March 2019, based on shipments observed through October. For 2019-’20, corn imports are raised for Vietnam, Colombia, Japan, and South Korea. Partly offsetting, are reductions for Iran, Egypt, Malaysia and Turkey. Foreign corn ending stocks are lower relative to last month, with declines for Brazil, Iran, Mexico, China and Argentina that are partly offset by small increases for several African countries. Global corn ending stocks, at 296 million tons, are down 6.6 million.