The current economic crisis in the US and around the world together financial problems within the ethanol idustry are continuing to hit demand for corn, according to the USDA Economic Research Service Feed Outloook report. Feed grain supplies for 2008/09 are up on November but slightly down year on year.
The 2008/09 corn use forecast is lowered this month as financial and macroeconomic developments are continuing to weaken corn demand. Corn used to produce ethyl alcohol for fuel is lowered because of financial problems in the ethanol industry. Corn and sorghum exports are also lowered due to weak demand. Global 2008/09 coarse grain production is projected higher this month to a new record. World 2008/09 coarse grain ending stocks are now projected higher than beginning stocks. In previous months, forecasts showed global coarse grain stocks declining year-to-year. U.S. corn and sorghum farm prices are projected lower this month, oats prices are unchanged, and barley prices are raised because of high contracted malting barley prices.
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