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Outlook Summary: U.S. and Global Corn and Feed Markets (2021/22)

Core Content Overview

This report provides an update on the U.S. and global outlook for corn and other coarse grains for the 2021/22 marketing year. Key factors influencing the market include changes in production, use, and prices, as well as international trade dynamics.

Main Points

U.S. Corn Outlook

• Higher Production and Supplies: The U.S. corn production forecast for 2021/22 was raised to 14,996 million bushels, an increase of 246 million bushels from the August forecast. This makes it the second-largest corn crop on record.
• Harvest Progress: The corn harvest began primarily in the Southern U.S. states, with limited activity in Kansas and Missouri by September 5. The harvest is expected to be fully underway in mid-to-late September.
• Yield and Area Forecast: National corn yield increased to 176.3 bushels per acre from 174.6 bushels per acre, with higher area planted and harvested. Key states like Minnesota, North Dakota, and South Dakota experienced lower yields due to drought, while Illinois, Indiana, and Ohio saw improved conditions.
• Domestic Use: Projected corn use for 2021/22 is 14,800 million bushels, up 150 million bushels from the previous month. Feed and residual use is expected to rise to 5,700 million bushels, while food, seed, and industrial use remains unchanged at 6,625 million bushels.
• Ending Stocks: Ending stocks for 2021/22 are projected at 1,408 million bushels, up from 1,242 million bushels in August. The stocks-to-use ratio is at 9.5%, still tight by historical standards.
• Farm Price Outlook: The projected season-average farm price for corn in 2021/22 is $5.45 per bushel, down from $5.75 per bushel in August. This is still the highest farm price since 2012/13.
• Cash Prices: Cash prices declined in August, with an average of $6.43 per bushel in Central Illinois, still higher than the $3.29 per bushel in August 2020.

International Corn Outlook

• Global Production Increase: Global coarse grain production for 2021/22 is projected to rise by 12.5 million tons, with corn production increasing by 11.7 million tons to 1,197.7 million tons.
• China's Role: China's corn production for 2021/22 is projected to increase by 5 million tons to 273 million tons, driven by improved weather and crop conditions. Corn use in China is expected to decrease for 2020/21 and 2021/22 due to increased use of cheaper alternatives like cassava.
• Argentina's Growth: Argentina's corn production is expected to increase by 2 million tons to 53 million tons, with continued favorable planting conditions and increased area planted.
• Other Countries: Some countries, like Russia and Serbia, experienced reduced corn production, while Australia and Ukraine saw increases in barley output. Canada's barley and oat production declined due to adverse weather and lower yields.

Sorghum and Barley Outlook

• Sorghum Production: U.S. sorghum production for 2021/22 is projected at 11.5 million tons, up 1.1 million tons from August. Ending stocks are raised to 32 million bushels.
• Barley Prices: The projected average-farm price for barley in 2021/22 is $5.45 per bushel, down $0.30 per bushel from the previous month. This is due to both feed and malting barley markets.
• Barley Production: U.S. barley production remains at 106 million bushels, while exports are projected to rise to 9 million bushels. Drought conditions in the Northern Plains have impacted barley production.

Oat Outlook

• Lower Oat Imports: Oat imports for 2021/22 are projected at 74 million bushels, down 3 million bushels from August. This is due to tighter supplies from Canada, the primary foreign supplier.
• Feed and Residual Use: Feed and residual use for 2021/22 is reduced by 5 million bushels to offset lower supplies.

Total Feed and Residual Use

• Energy Feed Use: Total feed and residual use for energy feeds (corn, sorghum, barley, oats, and wheat) is projected at 151.5 million metric tons, down from 153.4 million metric tons in the previous year.
• Grain-Consuming Animal Units (GCAUs): GCAUs are projected at 101.1 million units, a small decrease from the previous month and the 2020/21 estimate. Despite this, GCAUs remain high by historical standards, supporting elevated feed grain prices.

Key Information

• Supply and Demand: Higher production and supplies in the U.S. and globally have led to increased ending stocks and lower price outlooks.
• Trade Dynamics: The U.S. is expected to export more corn to Canada and Mexico due to Gulf port issues. Argentina is emerging as a major competitor.
• Weather Impact: Drought conditions in the Western Corn Belt have reduced yields, while improved weather in China and Argentina boosted production.
• Market Trends: Ethanol production has declined due to higher corn prices and limited availability, but is expected to recover with the new crop. Corn feed use is influenced by alternative grains and policy changes.
• Inflation Concerns: Higher corn stocks in China may help in curbing inflation, a key concern for the government.

Summary Table of Key Projections

Figures and Maps

• Figure 1: U.S. corn yield trends (1988–2021)
• Figure 2: Corn harvest progress by state
• Figure 3a and 3b: U.S. corn yield and area forecasts
• Figure 4: U.S. gasoline and ethanol production and prices
• Figure 5: U.S. cash-market corn prices
• Map A and B: Corn and barley production changes
• Map C: Corn ending stocks changes

This report highlights the impact of production forecasts, weather, and trade dynamics on the U.S. and global corn and feed markets, with a focus on supply, use, and pricing trends.