WASDE lowers forecast for 2020-’21 corn use in ethanol

By Erin Voegele | October 09, 2020

The USDA lowered its forecast for 2020-21 corn use in ethanol in its latest World Agricultural Supply and Demand Estimates report, released on Oct. 10. Forecasts for corn production, feed and residual use, and ending stocks were also lowered.

Corn production is forecast at 14.22 billion bushels, down 178 million with a reduction in harvested area and a slight decline in yield to 178.4 bushels per acre. Corn supplies are forecast down sharply from last month, on a smaller crop and lower beginning stocks.

Corn used for ethanol is down 50 million bushels, based on weekly ethanol production date as reported by the U.S. Energy Information Administration into early October. The USDA now expects 5.05 billion bushels of corn to go to ethanol production in 2020-’21, compared to 4.852 billion bushels in 2019-’20 and 5.378 billion bushels in 2018-’19.

Projected feed and residual use is lowered 50 million bushels based on reduced crop and higher expected prices. Corn ending stocks for 2020-’21 are lowered 336 million bushels. The corn price is raised 10 cents to $3.60 per bushel.

Foreign corn production is forecast modestly higher with increases for several countries, including Serbia, Ghana, Kenya, Tanzania, Burkina, and Mali more than offsetting declines for Ukraine and the European Union. The projected corn yield for Ukraine is lowered based on the reported harvest results to date.

Corn exports are raised for Serbia, but lowered for Ukraine and the EU. For 2019-’20, corn exports for Argentina are raised for the local marketing year beginning March 2020 based on larger-than-expected shipments through September. For 2020-’21, corn imports are lowered for the EU, Iran and Kenya, but raised for Saudi Arabia, Vietnam and Iraq. Foreign corn ending stocks are higher, mostly reflecting increases for Mexico, the EU and Canada. Global corn ending stocks, at 300.5 million tons, are down 6.3 million from last month.