The USDA has surprised with a much deeper-than-expected cut in the 2024 average estimated US corn yield.
In updated monthly supply-demand estimates Friday, the USDA hacked its average estimate yield by 3.8 bu/acre from December to 179.3 bu. Although partially offset by a 200,000-acre increase in the planted area estimate to 82.9 million, the lower yield reduced the 2024 corn production estimate by 276 million bu to 14.867 billion bu – down 3% from a year ago.
With the reduction in output, the USDA lowered its export and feed and residual use estimates from last month but projected 2024-25 ending stocks were still cut by 198 million bu to 1.54 billion, compared to 1.763 billion in 2023-24.
Going into today’s report, the average trade guess was for just a 0.4 bu/acre reduction in the average yield from last month’s 183.1 bu. The government’s production and ending stocks estimates also fell below trade expectations, with corn futures jumping 16-17 cents higher after the report’s noon hour ET release.
On the demand side, the USDA lowered its corn export forecast by 25 million bu to 2.45 billion, after just raising it by 150 million bu in December. Meanwhile, feed and residual use was reduced 50 million bu from last month to 5.775 billion, based on indicated disappearance during the September-November quarter as reflected by the quarterly grain stocks report, also released today.
Foreign corn production is forecast higher this month with increases for China, Ghana, and Russia. China corn production is raised to a record 294.9 million tonnes, based on the latest data from the National Bureau of Statistics. Brazil and Argentina corn production for 2024-25 was left unchanged from December at 127 million and 51 million tonnes, respectively. Analysts and traders had been expecting a slightly reduction in the Argentina forecast, and a small increase for Brazil versus last month.
Global corn ending stocks for 2024-25, at 293.34 million tonnes, are down 3.1 million from December and below 317.46 million in 2023-24.
The 2024-25 season-average corn price received by US producers is raised 15 cents this month to $4.25/bu, down from $4.55 the previous year.
