Exports and Ethanol Demand Nudge Price Projections Upward

Jun 14, 2018

Lowered supply projections and increased yield forecasts may bump the price farmers receive for a bushel of corn upward by ten cents according to U.S. Department of Agriculture reports released today. Given the shift was, in large part, due to strong exports, the information reinforces the incredible economic importance of U.S. trade policies that allow for further demand growth.

This report indicated no change to projected production since the month prior. If realized, the yield, projected to 174 bushels per acre, would be the third-highest yield on record.

Beginning stocks projections were lowered to reflect a 75-million-bushel increase in 2017/2018 projected exports to 2.3 billion bushels. If realized, this would be the highest export level since 2007/2008. Notably, April exports hit a record high, surpassing November 1989 which was the best prior month to that point. May exports are expected to remain strong given export inspection data.

The report also indicates that old crop outstanding sales at this point in the marketing year also set a record high.

With an increased use of 50 million bushels projected due to higher demand from the ethanol sector, feed and residual use projections were lowered by 25 million bushels from last month reflecting the increased availability of ethanol coproducts as well as higher projected prices.

As supply projections fell and yield projections rose, ending stocks projections were adjusted downward by 105 million bushels to 1.57 billion bushels. If realized, this would be the lowest level since 2013/2014. The 2018/19 season-average corn price received by farmers is projected to be between $3.40 to $4.40 per bushel, a 10 cent-per-bushel increase from the previous month.

Source: NCGA

Video: Evolution of Beef Cattle Farming

The Clear Conversations podcast took to the road for a special episode recorded in Nashville during CattleCon, bringing listeners straight into the heart of the cattle industry. Host Tracy Sellers welcomed rancher Steve Wooten of Beatty Canyon Ranch in Colorado for a wide-ranging discussion that blended family history and sustainability, particularly as it relates to the future of beef production.

Sustainability emerged as a central theme of the conversation, a word that Wooten acknowledges can mean very different things depending on who you ask. For him, sustainability starts with the soil. Healthy soil produces healthy grass, which supports efficient cattle capable of producing year after year with minimal external inputs. It’s an approach that equally considers vegetation, animal efficiency, and long-term profitability.

That philosophy aligned naturally with Wooten’s involvement in the U.S. Roundtable for Sustainable Beef, where he served as a representative for the Colorado Cattlemen’s Association. The roundtable brings together the entire beef supply chain—from producers to retailers—along with universities, NGOs, and allied industries. Its goal is not regulation, Wooten emphasized, but collaboration, shared learning, and continuous improvement.