US Corn Ending Stocks Down on Greater Ethanol, Feed Demand

The USDA has trimmed its 2023-24 US corn ending stocks estimate from last month amid heavier ethanol and feed demand. 

In its latest monthly supply-demand estimates Thursday, the USDA pegged ending stocks at 2.122 billion bu, down 50 million from the March projection but still well above the previous year’s 1.36 billion. The USDA number was above the average pre-report trade guess of 2.109 billion, with futures trading 3-4 cents lower following the report’s noon ET release. 

On the demand side, corn used for ethanol was raised 25 million bu from March to 5.4 billion bu, compared to 5.176 billion in 2022-23. Feed use was bumped an identical 25 million bu higher to 6.805 billion – versus 6.558 billion last year – based on indicated disappearance during the December-February quarter. 

The USDA surprisingly left its 2023-24 Brazil corn production steady from last month at 124 million tonnes. Going into the report, most trader and analysts were expecting the Brazil crop to be lowered to 122.6 million. Earlier today, Brazilian crop agency Conab cut its estimate of the crop to 110.96 million tonnes from 112.75 million in March. 

The two reporting agencies are now more than 13 million tonnes apart on their respective Brazil corn production estimates, an unusually wide disconnect. 

Meanwhile, the USDA lowered its estimate of the 2023-24 Argentine corn crop by 1 million tonnes from last month to 55 million, “reflecting a decline in yield expectations.” However, projected Argentina corn exports were left steady from March at 42 million tonnes. 

Ukraine corn production and exports were unchanged from last month at 29.5 million and 24.5 million tonnes, respectively, while China’s projected imports were static at 23 million. 

Global corn ending stocks, at 318.3 million tonnes, are down 1.4 million from last month, but still up from 302.2 million last year and above the average trade guess of 317.1 million. 

The USDA lowered its season-average US farm price by a nickel from last month to $4.70/bu, down sharply from the 2022-23 average of $6.54.