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Agriculture Today


Government report, survey data peg record corn crop, says Farm Bureau




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August 21, 2013 | 4,280 views | Post a comment

WASHINGTON, D.C. -- The highly anticipated August World Agricultural Supply and Demand Estimates report was released Aug. 12 by the U.S. Department of Agriculture (USDA). This first report of the year to incorporate farmer survey and field plot measurements to projected yield and production potential indicates a record crop, according to an Aug. 13 American Farm Bureau Federation press release.

August’s World Agricultural Supply and Demand Estimates report projected the 2013 corn crop at 13.763 billion bushels, which would be a record crop, if realized, and a 2.98 billion bushel increase from 2012’s drought-stricken crop. The report estimates the 2013 corn yield at 154.4 bushels per acre, a reflection of the late planting season and cool, dry weather in the western Corn Belt, according to Todd Davis, American Farm Bureau Federation economist.

The USDA report predicts 2013-14 corn ending stocks to drastically increase from 719 million bushels for 2012-13 to 1,837 million bushels, elevating the stocks-to-use ratio from 6.4 percent to 14.5 percent.

“This means that the U.S. corn market is likely to go from a 23-day supply to a 52-day supply of corn. This increase in stocks will cause prices to decline from a marketing-average price of $6.95 per bushel for 2012-13 to a projected $4.90 per bushel in 2013-14,” said Davis.

Fuel vs. food debate

With the release of the updated corn report estimates, the Renewable Fuels Association was quick to defend the use of corn in the production of ethanol.

“America’s farmers have again risen to the challenge of producing abundant feed, food, and fuel for consumers around the world. After the disappointment of last year’s drought-stricken crop, farmers have responded by producing what is likely to be the largest crop of all time,” said Renewal Fuel Association President and CEO Bob Dinneen. “By rapidly adopting new seed and equipment technologies over the past decade, this country’s corn growers have distinguished themselves as the most productive in the world.”

Dinneen continued, “While it is important to remember the crop is not yet in the bins, today’s report should be the last nail in the coffin of the ridiculous ‘food versus fuel’ argument. Corn stocks are likely to hit an 8-year high and prices are at a 3-year low. Meanwhile, USDA is projecting food inflation to average just 2 percent in 2013, down from 2.6 percent in 2012 and well below the historical average of 3 percent. Meat prices are expected to advance just 1.5 percent this year, compared to 3.4 percent last year. All this while ethanol production, demand, and consumption continues to increase. Clearly, the link between the RFS [Renewal Fuel Standard], ethanol, and food prices does not exist.”

Dinneen noted that USDA’s report suggests livestock and poultry feed will remain as the top use of corn, accounting for 53 percent of total demand (when animal feed co-products from ethanol production are properly considered). By comparison, the ethanol industry is projected to account for 26 percent of corn demand on a net basis, exports will account for 10 percent, and food, seed, and industrial use will make up 11 percent. Additionally, feed usage is projected to be 15 percent higher than last year.

Soybeans

Another feed source, soybeans, was mentioned in the USDA report released.

According to the American Farm Bureau Federation, the 2013 U.S. soybean crop is projected at 42.6 bushels per acre, up 3 bushels per acre from the 2012 yield. The soybean crop is estimated at 3.225 billion bushels, up 240 million bushels from 2012 by 104 million less than the production record set in 2009.
 

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