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USDA Lowers Expected Corn Ending Stocks for 2022/23

The United States Department of Agriculture released the January World Agricultural Supply & Demand Estimates (WASDE) report yesterday. The expected reductions in use were met with notable changes to U.S. production that resulted in lower-than-expected ending stocks for the 2022/23 marketing year.

As compared to the December WASDE report, a 200 million bushel drop in total production was spurred by a 1.6 million acre cut in final 2022 harvested acres, more than offsetting a one bushel per acre increase in yield to 173.3 bushels per acre. The downward adjustment to 79.2 million harvested acres brings 2022 harvested acres to the lowest level since 2008. This translates to 89.4% of planted corn acres harvested in 2022, the lowest share of planted acres harvested since 2002.

The decline in harvested acres from the December report was highly concentrated in four states, with Kansas (-710,000 acres) and Nebraska (-480,000 acres) accounting for nearly three-quarters of the total and South Dakota (-240,000 acres) and Colorado (-120,000 acres) rounding out most of the remaining quarter. Compared to 2021, 2022 harvested acres of corn silage were 75% higher in Kansas and 65% higher in Nebraska. Given the negative impact of drought on yields and pastures, some acres that would normally have been harvested as grain were instead harvested as silage, particularly in the larger drought impacted livestock-producing states.  

On the demand side, domestic use was trimmed by 35 million bushels from December, while exports were cut by 150 million bushels. The net result was a 15 million bushel drop in expected ending stocks to 1.24 billion bushels for the 2022/23 marketing year. If realized, this will be the lowest ending stocks since 2013/14 and would put stock levels, relative to use, at 8.9%, also historically low compared to most years. The forecast for tight supply and low stocks-to-use ratio remains.

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