Record U.S. corn harvest forecast

WASHINGTON – Corn supplies will remain tight in the United States, the world’s largest grower and exporter, even after an increase in planting boosts production to a record, the Department of Agriculture’s chief economist said.

Soybean and cotton production will also rise.

Farmers will harvest a record 13.73 billion bushels of corn, up from 12.447 billion last year, with 5 billion bushels devoted to ethanol, compared with 4.95 billion for the 2010 crop, Joe Glauber predicted last week at a USDA forum near Washington. Increased demand will limit the gain in inventories, with supplies on Aug. 31, 2012, rising to 865 million bushels from 675 million expected at the end of the current crop year, Glauber said.

“Despite an increase in acres, the corn market is going to remain tight,” Glauber forecast. “It points to the fierce competition for acreage this spring.”

Tighter supplies helped boost global food costs by 25 percent last year, reaching the highest ever last month, according to the United Nations. Rising demand also is helping to boost net-farm income in the U.S. by 20 percent this year to a record $94.7 billion, the USDA said earlier this month. U.S. farm exports will jump 25 percent to a record $135.5 billion in fiscal 2011, Glauber said.

U.S. soybean output will rise to 3.345 billion bushels this year from 3.329 billion in 2010, with end-of-year inventories at 160 million bushels, an increase of 20 million bushels, according to the USDA. The U.S. is the world’s largest grower and exporter of the oilseed.

Wheat production will be 2.08 billion bushels, down from 2.208 billion in 2010 because of lower yields, Glauber said. U.S. wheat exports are forecast at 1.15 billion bushels, down almost 12 percent. Stockpiles before the next harvest are forecast to fall to 663 million bushels on higher food and feed use.

Overseas purchases of agricultural products from the U.S., the largest exporter of wheat and cotton, probably will jump $26.8 billion in fiscal 2011 from the year that ended on Sept. 30, Glauber said. China is forecast to be the top market for U.S. agricultural exports at $20 billion, surpassing Canada’s $18.5 billion, he said. Imports will be a record $88 billion.

(Source: http://www.journalgazette.net/article/20110228/BIZ/302289991/-1/BIZ09)