Production drop, big demand shrinking corn stocks
* U.S. corn supply seen falling to 15-year low
* Corn use for ethanol nearing 40 percent of production
Sam Nelson
Reuters
U.S. corn stocks are expected to slump to the lowest level in 15 years this year due to strong demand, possibly stoking global food prices which hit a record high last month, a Reuters Poll of analysts showed.
Analysts also said harsh weather cut corn output to 12.502 billion bushels from the previous year’s record 13.110 billion and below the U.S. Department of Agriculture’s (USDA) forecast in November for 12.540 billion bushels.
“If the USDA begins to lower production in the fall, there’s usually another reduction in the January report,” said Jack Scoville, an analyst for The Price Group.
The USDA will release its January crop production, supply/demand, quarterly stocks and winter wheat acreage reports at 7:30 a.m. CST (1330 GMT) on Wednesday. The Jan. 12 report will be the USDA’s final estimate of corn production.
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