Exporters, livestock feeders and ethanol makers are going through the U.S. corn stockpile faster than farmers can grow the crops, the government said July 9.
Despite record crops in two of the past three years and another record within reach this year, the USDA estimated the corn carry-over will shrink to the lowest level since 2006-07.
Its monthly look at crop supply and usage estimated 1.478 billion bushels of corn will be in U.S. bins on Aug. 31, and 1.373 billion bushels will be on hand at the end of 2010-11.
The carry-over figures are sharply lower from USDA’s previous estimates – down eight per cent for this year and down 12 per cent for next year – but slightly larger than traders expected.
The report was anticlimactic after USDA last week shocked markets with data that showed corn plantings were smaller than expected this year and corn consumption through June 1 was far larger than expected.
That data had spurred U.S. corn futures up 16 per cent to a two-month high but prices are still far below 2010’s peak above $4.25 a bushel seen in early January.
Weighing on wheat futures were USDA estimates of a 2.2-billion-bushel U.S. crop, up seven per cent from its previous estimate and a surplus equal to six months’ use.