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Economic Research Service Feed Outlook Summary (FDS-16c, March 11, 2016)

Core Content

This report provides an overview of the 2015/16 feed and coarse grain outlook, including production, use, trade, and price projections for major countries and globally. It highlights the shifts in supply and demand, trade dynamics, and market influences across the U.S. and international markets.

Main Points

Global Corn Outlook

• Production: Increased by 2.3 million tons to 1,264.3 million tons.
• Exports: Brazil's corn exports are projected to reach a record 36.5 million tons, driven by strong export demand and weak currency.
• Ending Stocks: Despite increased production, global ending stocks are still expected to be record high, at 245.2 million tons.
• U.S. Corn Exports: Reduced to 42.0 million tons (down 1.5 million tons from previous forecast), due to slower shipment pace.
• Corn Prices: Projected price range for 2015/16 narrowed to $3.40–$3.80 per bushel, with a midpoint of $3.60.

U.S. Domestic Outlook

• Feed and Residual Use: Increased by 0.3 million tons to 145.5 million tons, driven by higher wheat use.
• Corn for Ethanol: Revised down by 8.4 million bushels in 2014/15, but unchanged in 2015/16.
• Oats Prices: Midpoint projected down by 5 cents per bushel to $2.15, with a lower high end by 10 cents.
• Barley Trade: Imports and exports increased by 2 million bushels each, with no impact on carryout.
• NASS Reports: Upcoming reports on March 31 will provide insights into March 1 stocks and influence April supply and use projections.

International Outlook

• Brazil: Corn production increased to 84.0 million tons, with a focus on second-crop corn. Domestic feed use is cut due to high prices, while exports remain strong.
• Argentina: Corn production up 1.4 million tons to 27.0 million, driven by policy changes and currency devaluation. Exports are projected to rise to 19.5 million tons, the second-largest on record.
• South Africa: Corn production cut by 1.0 million tons due to drought and high temperatures.
• Other Countries: Production increases for EU (corn, barley, rye), Kazakhstan, Turkey, and Japan. Reductions for Mexico (sorghum), Indonesia, El Salvador, and Honduras.
• Global Trade: Corn trade increased by 2.6 million tons to a record 130.8 million tons, supported by competitive pricing and import demand.

Key Information

• Major Exporters: Brazil, Argentina, and Paraguay are key players in the global corn and barley trade.
• Market Influences: Weak currencies (Brazil, Argentina) and policy changes (export taxes, quotas) have significantly impacted trade and production.
• Domestic Demand: China is shifting from wheat to corn in feed use due to price supports and demand.
• U.S. Competitiveness: U.S. corn exports face challenges due to the strong dollar, with Argentina and Ukraine as stronger competitors.
• Supply and Use: Global coarse grain use is projected up 0.9 million tons to 1,261.1 million tons, while supply increased by 1.3 million tons to 1,506.3 million tons.
• Stocks: Brazil's corn stocks are forecast down by 0.5 million tons due to increased exports, while U.S. ending stocks are up slightly due to increased imports.

Figures and Data

• Figure 1: U.S. food, seed, and industrial use of corn.
• Figure 2: U.S. corn utilization.
• Figure 3: U.S. feed grain ending stocks.
• Figure 4: U.S. corn exports.
• Figure 5: U.S. sorghum exports.
• Figure 6: Major competitors' corn exports.
• Figure 7: Brazil's corn exports by marketing year.

Contacts and Resources

• Contact: Thomas Capehart (tCAPEhart@ers.usda.gov) for domestic, Edward Allen (ewallen@ers.usda.gov) for international.
• Subscription: Available via ERS e-mail notification or by purchasing from the USDA Order Desk.
• Data Sources: Feed Grains Database, WASDE reports, and other USDA publications.
• Related Websites: Feed Outlook, Grain Circular, World Agricultural Production, and Corn Briefing Room.

Summary of Changes

Outlook Highlights

• Global Corn Supply and Demand: Despite increased production, global corn ending stocks remain record high due to reduced beginning stocks.
• U.S. Market Dynamics: Slow export pace and strong dollar reduce U.S. competitiveness in corn trade.
• Brazil's Role: Strong export demand and weak currency are key drivers of Brazil's record corn exports.
• China's Shift: Increased corn feed use and reduced wheat prices are shifting demand in China.
• Policy Impact: Changes in Argentina and Brazil have had a significant effect on corn production and trade.