Some analysts say the estimate is too low. Rising oil prices mean ethanol is still cheaper than gasoline in some places, encouraging refiners to maximize its use in blending.
Production cuts by an estimated two dozen plants ― mostly older, less-efficient facilities located further from the Corn Belt ― have helped boost margins enough to sustain output.
"I think we'll see a fairly aggressive pace of demand rationing in the export sector first, followed by feed, followed by ethanol," said Shawn McCambridge, analyst with Jefferies Bache.
But others questioned whether use may decline further, citing a recent slowdown in ethanol production blamed on poor plant margins amid this summer's historic rally in corn prices.
Calls for the suspension of a government mandate on ethanol blending could be a swing factor, with the United Nations chiming in on the debate last week.
"I think the ethanol could be lower than (the USDA estimate) ... If the price of ethanol increases, which I think it will given the higher cost of production, it may not be as competitive an octane source," said Bill Lapp, president of Advanced Economic Solutions. Demand may be nearer 4 billion bushels, he said.
Overseas demand is another part of the puzzle. While theoretically made easy thanks to U.S. government rules that require exporters to report all sales within a week of a deal, predicting the pace of annual shipments is tricky work.
The USDA has already cut its outlook for 2012/13 exports to the lowest in 28 years, at just 1.3 billion bushels. It slashed 300 million bushels in each of the past two months.
Because this year's supply distress is domestic, unlike during the price spikes of 2008 and 2010, many importers are simply buying from other producers such as Brazil, which yielded a record corn crop this year.
But many of them have also begun more aggressive campaigns to replace corn as a source of livestock feed, relying on feed wheat instead. This trend has helped to whittle global wheat stocks, which hit a record 200 million tonnes two years ago.
South Korea, traditionally a top-five U.S. corn customer, has been a particularly active feed wheat buyer of late. The country's wheat imports hit a record 5.2 million tonnes this season as nearly 2.9 million tonnes were imported to feed livestock, while its corn imports fell to the lowest in three years, according to the USDA.
Emerging corn importer China was forecast to produce a record-large 200-million-tonne crop this season, which would limit its import needs to just 2 million tonnes, the USDA said. Earlier this year, China had been expected to import a record 7 million tonnes in 2012/13.