USDA projected smaller corn stocks at the end of this year and next and boosted the agency’s average price projections for corn and soybeans.

In its monthly World Agricultural Supply and Demand Estimates report, USDA boosted its average corn price forecast to a range $3.45 to $4.05 per bushel from last month’s $3.30 to $3.90 range for the 2010/11 marketing year which begins Sept. 1. For the 2009/10 marketing year, USDA estimated the average corn price at $3.50 to $3.60.

U.S. corn use for 2009/10 was projected 125 million bushels higher as increased feed and residual use more than offsets a reduction for ethanol. Corn use for ethanol was lowered 50 million bushels to 4.5 billion bushels, reflecting the latest ethanol production data from the Energy Information Administration (EIA).

Although daily ethanol disappearance set another record in April, daily production slipped below March’s record pace. EIA’s new weekly ethanol production data series suggests June production, while up from April, will not reach the March pace.

USDA raised its average soybean price forecast for 2010/11 to a range of $8.10 to $9.60, up 10 cents on each end from last month’s forecast. It estimated an average price of $9.55 for the 2009/10 marketing year.  Soybean meal prices for 2010/11are projected at $240 to $280 per ton, up $10 on both ends. Soybean meal prices in 2009/2010 were estimated to average $300 per ton.

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