Audio courtesy of Susan Carter with USDA
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The Renewable Fuels Association called Tuesday’s World Agricultural Supply and Demand Estimates report a “non-event:,” as far as the U.S. corn balance sheet is concerned; the only change was a slight decrease in the 2012/13 season-average price estimate, from $7.60/bu. to $7.40/bu.
Part of the reason behind that decrease is poor profit margins in the ethanol market, which are increasing the corn supply, as USDA Chief Economist Joe Glauber explains.
However, there were some important revisions in the WASDE report on the global side. Global coarse grains production increased 7.9 million metric tons, as China reported a 4% larger corn crop. Canadian corn output was also revised higher, while the estimated size of Brazil’s corn crop was unchanged, and Argentina saw a slight decrease.
Total global grain supplies, coarse grains, wheat and rice, were raised slightly to 2705.6 million metric tons , the second-largest on record. RFA projected that just 2.92 percent of the world grain supply will be consumed for U.S. ethanol …the lowest rate in 5 years.