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Cotton and corn production estimates lower in latest WASDE report

Contributing factors to decreased crop reduction estimates for cotton and corn include continued drought conditions in the Southwest and rain and cool temperatures in the Midwest.

Cotton and corn production estimates for 2013/14 are reduced in the latest World Agricultural Supply and Demand Estimates (WASDE), while wheat, sugar and total meat production are expected to increase. Rice, soybean and milk production will remain unchanged from last month, according to latest figures.

Contributing factors to decreased crop reduction estimates for cotton and corn include continued drought conditions in the Southwest and rain and cool temperatures in the Midwest.

Estimates include:

Cotton — Projected U.S. cotton production for 2013/14 is reduced to 13.5 million bales for 2013/14. The supply and demand balance sheet shows lower beginning and ending stocks, lower production, and higher prices relative to last month. The 2012/13 export estimate is raised 350,000 bales to 13.6 million, reducing the current season’s ending stocks forecast. This adjustment reflects continued strong sales and shipments and expected higher imports by China.

The total 2013/14 supply is rated 900,000 bales below last month, and U.S. exports are reduced 500,000 bales to 11.0 million; ending stocks are reduced to 2.6 million, the equivalent of 18 percent of total use.

The projected range for the marketing-year average price of 73 cents to 93 cents per pound is raised 5 cents on each end, with a midpoint of 83 cents per pound, 15 percent above the estimated average for 2012/13. Projections assume that China continues current policies regulating the national reserve acquisition and release prices.

Corn — A good start to planting across the Corn Belt has seen a reversal in recent weeks with rains and cool temperatures delaying completion of planting in parts of the western Corn Belt. The delay raises the likelihood of vulnerability to seasonally warmer temperatures and drier conditions in late July.

Projected corn production is lowered 135 million bushels to 14.0 billion with the average yield projected at 156.5 bushels per acre, down 1.5 bushels from last month.

Domestic corn usage is now projected at 70 million bushels lower for 2013/14. Projected feed and residual disappearance is lowered 125 million bushels with the smaller crop, higher expected prices, and increased availability of distillers’ grains.

Corn used in ethanol production is raised 50 million bushels. Other food and industrial uses are projected higher, up 5 million bushels from last month.

Corn ending stocks for 2013/14 are projected 55 million bushels lower. At the projected 1.9 billion bushels, ending stocks are expected to be 2.5 times their 2012/13 level. The season-average farm price range for corn is raised 10 cents per bushel on each end to $4.40 to $5.20 per bushel. Increases are also projected for the sorghum, barley, and oats farm price ranges this month.

Corn exports are projected 50 million bushels lower, based on lackluster shipments and sales. Projected corn ending stocks for 2012/13 are raised 10 million bushels.

Global coarse grain supplies for 2013/14 are projected 4.3 million tons lower, mostly on reduction expected in U.S. corn output. At the projected 151.8 million tons, 2013/14 world corn stocks would be up 27.5 million tons from 2012/13 and the largest in 12 years.

Wheat — U.S. wheat supply projections are up this week based on increased beginning stocks and higher winter wheat production estimates. A 15-million bushel reduction in 2012/13 exports is also reported as May shipments fell below expectations. Production for 2013/14 is estimated up 23 million bushels as higher yields boost forecast production of Hard Red Winter wheat in the Southern and Central Plains and Soft Red Winter wheat across the South and Midwest.

Exports are projected at 50 million bushels higher for 2013/14. Early season sales and outlook for foreign production are reduced. Ending stocks for 2013/14 are projected down 11 million bushels. Projected stocks of 659 million bushels remain at a 5-year low.

The projected range for the 2013/14 season average farm price is raised 10 cents on both ends to $6.25 to $7.55 per bushel. This is down from the record $7.80 per bushel expected for 2012/13.

Global wheat supply estimates for 2013/14 are down 5.6 million tons, reflecting lower foreign production. World production is projected at 695.9 million tons, down 5.2 million from last month with reductions for Ukraine, Russia, and EU-27. Persistent dry weather in key growing areas of southeastern Ukraine and adjoining areas of southern Russia reduces production prospects 2.5 million tons and 2.0 million tons, respectively. EU-27 production is lowered 1.3 million tons with small reductions in a number of member countries.

Rice — The 2013/14 all rice supply and use balance sheet is unchanged from last month. Small revisions are made to the 2013/14 rice by-class supply and use balance sheets.

Long-grain rice 2013/14 beginning stocks are raised 1.0 million hundredweight (cwt) to 21.4 million, resulting from reduced 2012/13 export now projected at 76.0 million. Combined medium- and short-grain 2013/14 beginning stocks are lowered 1.0 million cwt to 10.5 million, resulting from an increase in the 2012/13 export forecast now projected at 32.0 million. Rough rice exports for 2012/13 are lowered 1.0 million cwt to 35.0 million, and combined milled and brown rice exports are raised 1.0 million to 73.0 million.

The 2013/14 U.S. long-grain rice season-average farm price is projected at $13.90 to $14.90 per cwt, up 10 cents per cwt on each end from a month ago and compares to a revised $14.30 to $14.50 per cwt for 2012/13. The 2013/14 combined medium- and short-grain rice season average farm price is $15.80 to $16.80 per cwt, an increase of 30 cents per cwt on each end from last month and compares to a revised $16.00 to $16.20 per cwt for 2012/13. The 2013/14 U.S. all rice season-average farm price is projected at $14.50 to $15.50 per cwt, up 20 cents per cwt on each end from a month ago and compares to a revised $14.80 to $15.00 per cwt for 2012/13.

Global 2013/14 rice supply and use is little changed from a month ago. Global rice production is projected at a record 479.2 million tons, down less than 100,000 tons from last month.

Soybeans — U.S. soybean supply and use projections for 2013/14 are unchanged from last month. Changes for 2012/13 include increased soybean imports and crush, and reduced exports. Soybean imports are raised 5 million bushels to 25 million based on relatively strong imports through April and expected additional gains through the end of the marketing year.

Soybean exports for 2012/13 are reduced 20 million bushels to 1.33 billion bushels, reflecting exceptionally low shipments and sales in May as well as competition from Brazil.

Although soybean exports are reduced, U.S. soybean meal exports are increased this month, reflecting stronger than expected shipments this spring as importers have been slow to shift to South American supplies. U.S. soybean crush is projected at 1.66 billion bushels, up 25 million. Soybean ending stocks for 2012/13 are projected at 125 million bushels, unchanged from last month.

The 2013/14 season-average price for soybeans is forecast at $9.75 to $11.75 per bushel, up 25 cents on both ends of the range. Soybean meal prices for 2013/14 are forecast at $290 to $330 per short ton, up 10 dollars on both ends. The soybean oil price forecast is unchanged at 47 cents to 51 cents per pound.  Global oilseed production for 2013/14 is projected at 490.8 million tons, down 0.5 million from last month.

Sugar — Projected U.S. sugar supply for fiscal year 2013/14 is increased by 435,000 short tons, raw value, from last month due to higher beginning stocks and imports from Mexico. U.S. ending stocks for 2012/13 are up because higher imports from Mexico more than offset lower tariff rate quota imports. Mexico’s 2012/13 production is increased to reflect the strong pace of harvest to date. For both countries, 2013/14 use is unchanged from last month and ending stocks are increased.

Livestock, poultry, and dairy — The forecast for total meat production in 2013 is raised from last month as higher beef and broiler production more than offsets lower pork production. Beef production is raised from last month as poor forage conditions resulted in relatively large placements of cattle in feedlots in the first part of 2013 and cow slaughter remains high.

Broiler slaughter is raised slightly for the third quarter, reflecting hatchery data. Pork production in second quarter is lowered based on the pace of hog slaughter and slightly lower expected carcass weights. Turkey production is unchanged from last month. Egg production is raised, reflecting slightly higher table egg production in the third quarter. Red meat, poultry, and egg production forecasts for 2014 are unchanged from last month.

Forecasts for 2013 beef exports are reduced from last month as trade to a number of markets has been relatively weak.

Milk — The milk production forecast for 2013 is unchanged. For 2014, the production forecast is lowered as relatively weak milk-to-feed ratios in the third and fourth quarter of 2013 are expected to slow production growth in the first half of 2014. The all milk price is forecast at $19.60 to $20.00 per cwt for 2013 and $18.95 to $19.95 for 2014.

TAGS: Corn
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