10 April 2012 16:48 [Source: ICIS news]
HOUSTON (ICIS)--Corn and soybeans traded open higher on commodity exchanges on Tuesday following the release of bullish crop supply and demand forecast data from the US Department of Agriculture (USDA).
In its monthly World Ag Supply and Demand Estimates (WASDE) report, the USDA left US corn stocks and use for the 2011-12 crop year unchanged and lowered global soybean production based largely on crop trouble in South America.
The USDA, as the market anticipated, cut its estimates for soybean production in both Brazil and Argentina.
Brazil’s soybean harvest was estimated at 66m tonnes, a 2.5m tonne decrease from the USDA’s March estimate.
Argentina’s soybean crop was estimated at 45m tonnes, down 1.5m tonnes from the March estimate.
The USDA projected Brazil’s corn harvest at 62m tonnes while Argentina was estimated at 21.5m tonnes.
In Brazil, government officials said on Tuesday that the 2011-12 soybean crop would yield 65.6m tonnes, a decrease of 13% from the previous crop.
The southern Brazil states of Rio Grande do Sul and Parana, major soybean production areas, have been affected by a drought that began in late 2011.
The Brazilian corn story is somewhat different. The government estimates that the corn crop will yield a record 65.14m tonnes and a 13% increase from the prior year.
The USDA said grain stocks remaining from the 2011 US harvest include 801m bushels of corn, 250m bushels of soybeans and 793m bushels of wheat.
Commodity traders had anticipated that crop stockpiles would be larger.
Corn used to produce ethanol in 2011-2012 marketing year (1 September-31 August) is projected at 5bn bushels.
Weekly EIA ethanol production data suggest average daily ethanol production during February and March continued to fall, hitting its lowest level since early last autumn.
US corn crop projected to be largest since 1937.
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