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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsWhat shortage? There is a projected 1.8 billion bushels of corn in storage from 2011
http://www.theprairiestar.com/news/markets/corn-market-looking-for-reaction-to-june-grain-stocks-report/article_f99770cc-bfac-11e1-80fb-001a4bcf887a.htmlCorn market looking for reaction to June 29 Grain Stocks report
Posted: Thursday, June 28, 2012 11:35 am
Corn market looking for reaction to June 29 Grain Stocks
report By ANDREA JOHNSON For The Prairie Star The Prairie Star | 0 comments
The USDA was set to release the Grain Stocks report on June 29, and traders were anxious to determine the size of U.S. corn stocks in on-farm and off-farm storage as of June 1, 2012.
As of March 30, corn stocks in all positions totaled 6 billion bushels down 8 percent from the previous year. The World Agricultural Supply and Demand Estimates (WASDE), on June 12, estimated the projected U.S. 2011 corn ending stocks at a healthy 1.8 billion bushels. The number was unchanged from the May estimate.
The WASDE report did suggest that corn used to produce ethanol increased by 50 million bushels. Corn exports were estimated 50 million bushels lower.
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I was told that corn can be stored for years waiting for the price to go up by one of the farmers around here recently. He said they can store it for as little as a nickel a bushel per month while waiting for prices to increase. And then I see the news people advising people to stock up because food costs are going up. Something is funny here.
Don
no_hypocrisy
(46,116 posts)In other words, we technically have a respectable supply but a lot of it is allocated for exportation to other countries, not to be sold here in The Homeland. And that's the real reason why there is a projected shortage.
TwilightGardener
(46,416 posts)So I don't know if what's in storage would have an impact on human food supply, though it may go toward animal feed.
MadHound
(34,179 posts)First off, you can wipe out this year's corn crop for a wide swath of the US. The corn plants are, right now, dying in the field.
Yes, there might be 1.8 billion bushels in storage(though that is not a sure thing), but that isn't going to make up for the shortfall caused by this year's drought. Those lucky farmers who've got that corn in storage might make some money, but overall, it's a drop in the bucket. 1.8 billion bushels amounts to about ten percent of our annual corn crop. Oh, and let's not forget the US supplies about half the corn in the world, along with half the soybean crop(which still has a chance, but is also rapidly drying up and dying).
So that 1.8 billion bushels is what, maybe five percent of what the world needs each year? Not much. Furthermore, a lot of those farmers who are storing corn are probably going to be using it as sileage to feed their livestock.
Which brings us to feed. Cows and other livestock are fed corn as part of their feeding regiment. This year, the livestock farmer is in a horrible fix. The grass they depend on for their herds is gone, dried up in the field. There isn't going to be much hay for this winter, since much of the hay has also dried up. Most farmers got one cutting of hay, and that's all they're going to get, so hay prices are going up. Which leaves corn, used to finish out livestock. With corn gone, what is left to feed their animals?
The bottom line is food is indeed going to go up in price. It isn't due to evil speculators, though I'm sure they're going to get their cut. It is due to one simple fact, the bread basket of this country is burning up and drying out. Around here, this drought is a continuation of what started last summer, and we're praying it doesn't continue into next.
So yes, stocking up on food now, if you can, is a good idea. I picked up a half a cow and a hog earlier this summer, they are butchered and in the freezer. I felt lucky getting them at 3.25/lb. I suggest that if you know a farmer who can work a bulk deal out with you, do so, quickly.
Because yes, in a country where corn is king, without a corn crop this year, we're screwed.
DURHAM D
(32,610 posts)to explain this complex issue.
NNN0LHI
(67,190 posts)Argentina to approve more corn exports
Tuesday, 17 July 2012 | 14:45
Argentina's government will approve the exportation of 15 million tonnes of 2012-13 corn, with an announcement scheduled for Wednesday, President Cristina Fernandez said.
Fernandez's center-left government sets a ceiling on corn and wheat exports to guarantee affordable local food supplies and help tame high inflation.
It has eliminated an unpopular, incremental system for granting export quotas and now announces the bulk of export permits early in the season to create more competition among buyers and improve prices for farmers.
Argentina is the world's No. 2 corn supplier after the United States.
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http://www.blackseagrain.net/photo/ukraine2019s-corn-exports-surge-capping-price-rally-as-u.s.-crop-worsens/?searchterm=None
Ukraines Corn Exports Surge Capping Price Rally as U.S. Crop Worsens
Corn exports from Ukraine will almost double in the 12 months from July 1, easing a shortage of the grain and capping a 67 percent price rally in the past year as heat erodes prospects for the U.S. crop, the worlds biggest.
Ukraine is poised to overtake Brazil as the third-largest corn exporter after the U.S. and Argentina, shipping abroad 9.25 million metric tons of the grain this season, 81 percent more than last year, according to the median estimate of 10 analysts and traders surveyed by Bloomberg News. Ukraine exported 5.1 million tons of corn in 2010-11, making it the fourth-biggest supplier, according to the International Grains Council.
The market hasnt priced in yet the coming crop in Ukraine, which would be a record high, said Pierre Begoc, general director of the Kiev branch of Agritel, a Paris-based consultant to 2,000 farmers. Once we get closer to the harvest, with confirmation of this potential yield in Ukraine, it could limit the upside of the U.S. corn, if there is any upside left.
Corn prices surged as U.S. crop conditions fell to the lowest level since 2005 after the hottest summer since 1955 in Iowa and Illinois. Corn for December delivery climbed 7.75 cents, or 1.1 percent, to $7.4625 a bushel at 8:37 a.m. London time on the Chicago Board of Trade.
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I don't think I am going to get my hair on fire over this.
riderinthestorm
(23,272 posts)MadHound
(34,179 posts)The combined exports of those two countries doesn't even make up ten percent of what the US produces. And the fact is, over the past twenty-thirty years, we have become a corn dependent nation and world. Corn is in everything in this country, food, plastics, fuel, all sorts of strange stuff.
And the fact of the matter is that this year's corn crop is going to be quite small. This isn't speculation, this isn't alarmism, this is reality. Everywhere I see, everywhere I go, there is nothing but fields of dead and dying corn. From the Missouri Arkansas border right up through Iowa and beyond, east and west, the corn crop is failing. That is a fact.
The soybean crop is, at best, going to be reduced. If it rains substantially in the next couple of weeks, part of it can be saved. If not, then we're screwed there as well.
Oh, and let's not forget massive flooding in Russia and parts of Europe. So much for those crops as well.
NickB79
(19,246 posts)That's a drop in the bucket for world corn production.
riderinthestorm
(23,272 posts)or at least pretty misleading info.
The first one, about the "lazy" farmers whose corn crop was dying because they didn't do good soil prep was incorrect (corn yields will be down because of the lack of water but also because the high heat destroys the corn's ability to produce a high kernel yield which is out of anyone's control and has nothing to do with being "lazy" . The cob may look okay but the kernels are insufficient or they are reduced in size and quality.
Like hay, farmers are getting a second cutting but its only 1/3 of the normal yield and some of that's going to be of poor quality.
There are a lot of different varieties of corn so its impossible to say with certainty what type of corn is in storage. Secondly, its not a lot of corn in storage actually - its a reserve for a rainy day (and presumably it will be used) but its also probably promised as food aide overseas.