Good says there are still problems with estimating feed use during a quarter along with the production of ethanol and the production of distillers’ dried grains that are also fed. He says there is still no explanation for USDA’s sharp decline in feed use of corn, use of all grains, and all feeds per animal unit in the last half of the marketing year for the 2010 crop.
Grain prices, and particularly corn prices, collapsed after the USDA reported its final production estimates and stocks on July 12. But, curiously, the market was expecting numbers that were not all that different from what was reported by USDA. Nevertheless, the small increases were seen as negative by the market since it was expecting small decreases. Since the USDA numbers were in line with its prior reports, the collapse of the market was more of a function of traders not guessing properly, instead of the USDA being incorrect in its estimates.
Source: FarmGate blog