Earlier this month, the US Department of Agriculture released its World Agricultural Supply and Demand Estimates (WASDE), and the new figures reflect the third-largest corn crop and yield on record.
WASDE forecasts 12.7 billion bushels with an average yield of 155.8 bushels per acre. (As a point of reference, in 2008, the United States produced 12.1 billion bushels with an average yield of 153.9 bushels per acre.)
According to the US Grains Council, increased consumption for ethanol use resulted in the simultaneous creation of more than 30 million metric tons of distiller's dried grains with solubles (DDGS), a high-value feed product for domestic and international livestock producers. Although analysts initially projected 2010 exports of 6.2 million tons of DDGS, they now expect that amount will be surpassed this calendar year as the United States gears up to export approximately 8 million tons. China, which already has captured more than 2.5 million tons of US DDGS this calendar year, is anticipated to increase to more than 3 million tons in 2011.
In fact, the Council recently conducted its annual China Corn Tour and concluded that China's demand growth is expected to increase representing an opportunity for US corn.
"While the Council is projecting higher production numbers than last year, this does not indicate a bumper crop. Conservative estimates of demand growth suggest China will likely need to import," said Thomas C. Dorr, USGC president and CEO. "In the United States the harvest is fully underway with farmers in all major grain growing states working to bring in what looks like to be a large 2010 crop. The United States will continue to be a reliable supplier of corn and co-products and we look forward to China being a long-term U.S. trading partner."