US corn year-end stocks forecast lowered, exports estimate lifted

New Delhi — The US Department of Agriculture lowered the US corn ending stocks estimate to 1.502 billion bushels for 2020-21 from 1.552 billion bushel projected in January, the department said in its February World Agricultural Supply and Demand Estimates Feb. 9.

This is the second consecutive cut to the country's year-end stocks estimate. According to sources, the market was eyeing a bigger cut.

"USDA pegged corn stocks at 1.502 billion bushels, down just 50 million bushels on the month and up from trade expectations of 1.392 billion bushels. My estimate is 1.411 billion bushels," said Arlan Suderman, chief commodities economist at StoneX Group.

S&P Global Platts Analytics projects US corn ending stocks for 2020-21 at 1.4 billion bushels.

The USDA raised its export projections for US corn in 2020-21 to 2.6 billion bushels from 2.55 billion bushels seen earlier in January.

The market expected USDA to raise its export estimate for US corn following record buying from China in the recent weeks. Platts Analytics has estimated US corn exports in 2020-21 at 2.7 billion bushels.

"USDA increased US corn exports by just 50 million bushels today, assuming that increased Chinese demand will send some non-China business elsewhere," said Suderman.

The USDA raised China's import estimates to 24 million mt from 17.5 million mt in January.

The USDA also revised upward the US' total corn consumption to 14.625 billion bushels from 14.575 billion bushels earlier.

The season-average corn price was increased to $4.30/bushel from $4.20/bushel earlier, the WASDE report said. Higher buying from China and shrinking stocks have supported rising prices of US corn.

The most active March futures contract of corn on the Chicago Board of Trade shed some gains following the WASDE report as market's expectations of a more bullish report had supported prices earlier, analysts said. The contract fell nearly 20 cents/bu following the report and was trading at $5.52/bu.

The estimates for US feed and residual use and corn used for ethanol were left unchanged at 5.65 billion bushel, and 4.95 billion bushel, respectively.