Source:  Rita Jane Gabbett, MEATINGPLACE.COM, 7/10/09

Based on last month's surprise forecast of expanded corn acreage, USDA raised its forecasts for the 2009/2010 corn production marketing year and predicted higher ending stocks for both the 2008/2008 and 2009/2010 crop years, resulting in lower price forecasts for both years.

Corn production for 2009/10 is now projected at 12.3 billion bushels, up 355 million from last month.

Ending stocks of corn for 2008/09 are raised 170 million bushels as lower domestic use more than offsets an increase in expected exports. Ending stocks of corn for 2009-2010 were forecast at 1.55 million bushels, up 460 million from last month.

The 2008/2009 marketing-year average corn price is projected at $3.95 to $4.15 per bushel, down 15 cents on both ends of the range reflecting sharply lower summer price prospects. The 2009/10 marketing-year average farm price for corn is projected at $3.35 to $4.15 per bushel, down 55 cents on both ends of the range.

The decline in corn prices has boosted ethanol producer margins; however, reduced production of gasoline blends with ethanol in May and June, based on the most recent weekly data, indicate lower-than-expected ethanol corn use, USDA said in its monthly World Agricultural Supply Demand Estimates report.

Soybeans

Soybean production was projected at 3.26 billion bushels, up 65 million due to increased harvested area.

Increased exports and crush partly offset increased supplies, leaving projected 2009/10 ending stocks at 250 million bushels, up 40 million from last month.

The U.S. season-average soybean price for 2009/10 is projected at $8.30 to $10.30 per bushel, down 70 cents on both ends of the range. Soybean meal prices are projected at $255 to $315 per short ton, down 20 dollars on both ends.

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