U.S. farmers can't meet booming corn demand
Exporters, livestock feeders and ethanol makers are going through the U.S. corn stockpile faster than farmers can grow the crops, the government said on Friday.
Despite record crops in two of the past three years and another record within reach this year, the Agriculture Department estimated the corn carryover will shrink to the lowest level since 2006/07.
In a monthly look at crop supply and usage, USDA estimated 1.478 billion bushels of corn will be in U.S. bins on August 31, when this marketing year ends, and 1.373 billion bushels will be on hand at the end of 2010/11.
The carryover figures are sharply lower from USDA's previous estimates -- down 8 percent for this year and down 12 percent for next year -- but slightly larger than traders expected.
"The number is definitely a negative, when you look at the carryout numbers," said Don Roose, analyst with U.S. Commodities in West Des Moines, Iowa.
The report was anticlimactic after USDA last week shocked markets with data that showed corn plantings were smaller than expected this year and corn consumption through June 1 was far larger than expected.
That data had spurred U.S. corn futures up 16 percent to a two-month high but prices are still far below 2010's peak above $4.25 a bushel seen in early January.
Wheat futures fell 2 percent on Friday, weighed by USDA estimates of a 2.2 billion-bushel U.S. crop, up 7 percent from its previous estimate and a surplus equal to six months' use. Wheat for September delivery ended the day at the Chicago Board of Trade at $5.38 a bushel, down 2 percent.
August soybeans rose 1 percent for the day, closing at $9.93-1/4 a bushel. September corn ended at $3.83-1/2, down 2 cents a bushel.
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