Feed and residual use for the four feed grains plus wheat is forecast lower this month according to latest Feed Outlook report from USDA. Accordingly, compared to February and also to the previous year, the number of grain-consuming animal units is also lower.
USDA increased its corn export projections for 2013-2014 this month to 1,625 million bushels, up 25 million. According to the report, corn sales and shipments have accelerated in recent weeks, and outstanding sales at the end of February reached the highest level since February 14, 2008. U.S. corn sales have benefited from a lull in the intensity of competition from other corn exporters, and the recent pace in sales indicates an increase in shipments of U.S. corn in the coming months.
USDA reduced its forecast for U.S. corn ending stocks by 25 million bushels to 1,456 million bushels on the higher export projections. The resulting stocks-to-use ratio is 10.9 percent, compared to 11.1 percent in February. The forecast for corn used for ethanol is unchanged, USDA reports, at 5,000 million bushels.
Despite the higher export projections for corn, farm prices for feed grains are mostly unchanged this month with the range for corn, sorghum and oats all narrowing slightly according to USDA.
Projected corn prices are steady, with the midpoint of the range at $4.50 per bushel. Since last month, the range has tightened 5 cents on both the high and low ends. For sorghum, the farm price range narrowed 5 cents on the high and low ends, but the midpoint remained at $4.25 per bushel. The price for barley raised 10 cents on the low end and increased the projected midpoint to $6.10 per bushel.
As a result of logistical problems in Canada that resulted in a 10 million bushel decline in expected oat imports, oat supply prospects are tight in the United States. According to USDA, the feed and residual use is lowered to 80 million bushels and industrial use is projected down 2 million bushels to 155 million bushels. Additionally, carryout is 3 million bushels lower to 30 million. Despite these challenges, the farm price range for oats is steady at $3.70 per bushel.
According to the report, oat prices on the Chicago Board of Trade nearby contracts and some cash markets have been higher than corn, which is a highly unusual occurrence as oat prices are generally 75 percent of corn prices.
On March 31, USDA’s National Agricultural Statistics Service will release its Projected Plantings report. This will be the first survey-based projection of the 2014 acreage based on producer planting intentions as of early March. Additionally, NASS will release the Grain Stocks report, which will provide stocks estimates for feed grains as of March 1.
View the full Feed Outlook report from USDA.