FEED OUTLOOK December 13, 1995 Approved by the World Agricultural Outlook Board ----------------------------------------------------------------------------- FEED OUTLOOK is published monthly (except January) by the Economic Research Service, U.S. Department of Agriculture, Washington, DC 20005-4788. FDS-1295 ----------------------------------------------------------------------------- HIGHLIGHTS o Corn and Sorghum Export Forecasts Raised o Projected Sorghum and Barley Prices Up o Forecast Barley Imports Reduced FEED GRAIN OUTLOOK REMAINS EXTREMELY TIGHT FOR 1995/96 No feed grain production estimates were made this month. Final estimates for 1995 crops will be released on January 11. In addition, estimates of grain stocks as of December 1 will also be released January 11, allowing disappearance for the September-November quarter to be calculated. This month's changes in supply and use forecasts for 1995/96 were relatively small, but indicate additional pressure on domestic feed grain use. Corn and sorghum exports were raised, while barley imports were reduced. In each case, this led to a reduction in feed and residual use. Projected ending stocks were unchanged, except for barley stocks, which were cut slightly. Feed grain prices remain strong, while prices for most other feedstuffs also have been strengthening in recent weeks. CORN EXPORTS PEGGED AT 2,100 MILLION BUSHELS The U.S. corn export forecast for 1995/96 (September-August) was increased 50 million bushels to 2,100 million (53.3 million tons). This reflects the torrid pace of exports to date and continued robust sales. Corn exports for the month of September reached 250 million bushels, the highest ever for September and the highest for any month since December 1989. Export inspections and export sales reports indicate exports remained large in October and November, although they may have tailed off somewhat from September. Final export figures by the Bureau of the Census are released about 6 weeks after the month ends. According to USDA's U.S. Export Sales report, sales and shipments in the first 3 months of the marketing year have already reached the equivalent of 62 percent of the 1995/96 export forecast. The increase in forecast corn exports was offset by a 50-million-bushel reduction in feed and residual use to 4,525 million bushels. This would be a decline of 1.0 billion bushels from 1994/95, and the largest year-to-year decline ever. No change was made in ending stocks of corn, projected at 617 million bushels, the lowest since 1974/75, when the marketing year began October 1 rather than the current September 1. SORGHUM EXPORTS RAISED Forecast sorghum exports in 1995/96 were increased 15 million bushels this month to 185 million. Feed and residual use was dropped by the same amount to a forecast 300 million bushels, which would be a decline of 100 million bushels from 1994/95. Despite a very tight outlook, export prospects for sorghum have increased because of European buying. Forecast sorghum imports by the European Union (EU) were increased 500,000 tons to 750,000 tons. Grain supplies are currently very tight in the EU, pushing up prices. EU import purchases of sorghum have been prompted by a reduction in the import levy linked to high EU barley prices. PROSPECTIVE BARLEY IMPORTS DOWN U.S. barley imports in 1995/96 are forecast at 45 million bushels, down 10 million from last month. Forecast feed and residual use was reduced 5 million bushels to 210 million, while ending stocks were also reduced 5 million bushels to 84 million. The lower import forecast reflects a substantial slowing in the pace of imports in recent months. This stems from tight local and Canadian feed grain supplies. Even with very attractive U.S. prices, more barley for feeding is expected to stay in Canada, and U.S. imports will mainly consist of malting barley this year. EXPECTED SORGHUM AND BARLEY PRICES INCREASED The projected sorghum price for 1995/96 was raised 10 cents to a record high $2.95 to $3.35 per bushel, equal to projected corn prices. Sorghum prices typically run between 90 and 95 percent of the corn price, but in October, the sorghum farm price of $2.87 was above corn. The preliminary price for November jumped to $3.02, the highest monthly sorghum price since January 1980. The all barley price forecast was also increased 10 cents on both ends to $2.70 to $3.00 per bushel. The preliminary price in November reached $3.15, the first time since 1981 that this price exceeded $3.00, reflecting strong prices for feed barley as well as for malting barley. No change was made in forecast oats prices this month, despite recent strong cash and futures prices. Because a large share of oats is normally sold early in the marketing year, the recent rise in prices is not likely to have a big impact on the season average farm price, projected at $1.55 to $1.65 per bushel. No change was made in the forecast of season average corn prices this month. In October, the corn price received by farmers was $2.78. The preliminary farm price for November was $2.90 per bushel, the highest monthly average since September 1984. Cash prices at Central Illinois points averaged $3.22 in November, up 10 cents from October, and the highest since July 1984. Sales of new-crop corn by farmers have reportedly been very slow so far. However, a significant share of the crop was likely contracted earlier, making it difficult to assess the seasonal marketing pattern this year. TRANSPORTATION: RAIL CAR USE DROPS Railcar loadings of grain and oilseeds declined steadily from September 1995. Loadings in October averaged 29,757 cars per week, down 4 percent from September. November loadings averaged 29,292 cars per week, down 2 percent from the prior month, but 1 percent above November 1994. The decline chiefly resulted from reduced use of rail to export points. Average railcar unloading of grain at ports fell 1,503 cars per week in October, down 15 percent from September. Rail unloading of grain at ports fell further in November, averaging 7,858 cars per week, 708 cars per week below October. COVERED HOPPER CAR INVENTORY CONTINUES UP The inventory of jumbo covered hopper cars (4,000 cubic feet capacity or more) grew throughout September-December 1995. On December 2, 1995, the jumbo covered hopper car fleet was 272,764 cars, 2 percent above September 1995 and 6 percent above December 1994. Despite the large inventory, media reports of rail car shortages persisted through the harvest season. Media sources also indicate that operating difficulties stemming from integration of the Union Pacific and Chicago & North Western railroads may have reduced service to shippers in the North Central States. MISSISSIPPI RIVER GRAIN TRAFFIC UP SHARPLY Preliminary data indicate that grain shipments on the Mississippi River during November increased 40 percent over the prior month to 1,319 short tons per week. Shipments during September-November averaged 49 percent above the same months of 1994. To a large extent, this reflects an increase in exports of corn through East Gulf ports, estimated up 33 percent from September-November 1994. ****************************************************************************** * Information Contacts: * * * * Pete Riley (202) 501-8512 T.Q. Hutchinson (202) 219-0391 * * Allen Baker (202) 219-0360 Sara Schwartz (202) 219-0768 * * * * Data Coordinator: Jenny Gonzales (202) 219-0704 * * * * The next Feed Outlook will be released January 12, 1996. * * * ****************************************************************************** Table 1--Feed Grains: Marketing year supply and disappearance 1/ ------------------------------------------------------------------------------- Year/ Beg. Produc- Im- Supply FSI Feed & Ex- Total End. Farm Qtr. stocks tion ports resid. ports disp. stks. price ------------------------------------------------------------------------------- CORN -------------------------Million bushels--------------------- $/bu 1993/94 Sep-Nov 2,113 6,336 5 8,455 378 1,705 435 2,518 5,937 2.34 Dec-Feb 5,937 --- 8 5,945 371 1,248 330 1,949 3,996 2.71 Mar-May 3,996 --- 6 4,002 419 954 270 1,642 2,360 2.67 Jun-Aug 2,360 --- 1 2,361 420 798 293 1,511 850 2.35 Mkt. yr. 2,113 6,336 21 8,470 1,588 4,704 1,328 7,620 850 2.50 1994/95 Sep-Nov 850 10,103 2 10,955 410 2,015 449 2,875 8,080 2.05 Dec-Feb 8,080 --- 4 8,084 403 1,499 590 2,493 5,592 2.18 Mar-May 5,592 --- 3 5,595 448 1,164 568 2,180 3,415 2.35 Jun-Aug 3,415 --- 1 3,416 432 856 570 1,857 1,558 2.59 Mkt. yr. 850 10,103 9.56 10,963 1,693 5,534 2,177 9,404 1,558 2.26 1995/96 Mkt. yr. 1,558 7,374 10 8,942 1,700 4,525 2,100 8,325 617 2.95-3.35 SORGHUM 1993/94 Sep-Nov 175 534 0 709 2 222 39 263 446 2.22 Dec-Feb 446 --- 0 446 2 108 60 170 276 2.59 Mar-May 276 --- 0 276 3 82 64 148 128 2.39 Jun-Aug 128 --- 0 128 2 41 38 81 48 2.10 Mkt. yr. 175 534 0 709 8 453 202 662 48 2.31 1994/95 Sep-Nov 48 655 0 703 2 214 64 280 422 1.91 Dec-Feb 422 --- 0 422 1 79 61 142 281 2.02 Mar-May 281 --- 0 281 2 66 54 122 159 2.18 Jun-Aug 159 --- 0 159 2 42 43 88 71 2.64 Mkt. yr. 48 655 0 703 7 402 223 631 71 2.13 1995/96 Mkt. yr. 71 464 0 535 7 300 185 492 43 2.95-3.35 ------------------------------------------------------------------------------- Table 1--Feed Grains: Marketing year supply and disappearance, (cont.) 1/ ------------------------------------------------------------------------------- Year/ Beg. Produc- Im- Supply FSI Feed & Ex- Total End. Farm Qtr. stocks tion ports resid. ports disp. stks. price ------------------------------------------------------------------------------- BARLEY -----------------------Million bushels--------------------- $/bu 1993/94 Jun-Aug 151 398 3 552 43 92 15 150 403 1.91 Sep-Nov 403 --- 11 413 38 27 15 80 333 2.02 Dec-Feb 333 --- 24 357 38 83 12 133 224 2.19 Mar-May 224 --- 34 258 56 40 24 119 139 2.24 Mkt. yr. 151 398 71 621 175 241 66 482 139 1.99 1994/95 Jun-Aug 139 375 24 538 43 122 20 186 352 2.00 Sep-Nov 352 --- 14 366 38 30 19 87 279 1.98 Dec-Feb 279 --- 14 292 38 51 11 99 193 2.05 Mar-May 193 --- 14 207 56 22 17 95 113 2.15 Mkt. yr. 139 375 66 580 175 226 66 467 113 2.03 1995/96 Mkt. yr. 113 361 45 519 175 210 50 435 84 2.70-3.00 OATS 1993/94 Jun-Aug 113 207 17 337 32 84 1.5 118 219 1.35 Sep-Nov 219 --- 35 254 29 30 0.7 60 194 1.33 Dec-Feb 194 --- 31 225 27 51 0.5 79 147 1.42 Mar-May 147 --- 24 170 37 28 0.2 65 106 1.39 Mkt. yr. 113 207 107 427 125 193 3.0 321 106 1.36 1994/95 Jun-Aug 106 229 20 355 32 103 0.2 135 220 1.19 Sep-Nov 220 --- 34 254 30 32 0.2 62 192 1.19 Dec-Feb 192 --- 23 215 28 38 0.4 66 149 1.21 Mar-May 149 --- 16 165 36 28 0.2 64 101 1.36 Mkt. yr. 106 229 93 428 125 201 1.0 327 101 1.22 1995/96 Mkt. yr. 101 163 105 369 125 155 1 281 88 1.55-1.65 ------------------------------------------------------------------------------- Totals may not add due to rounding. 1/ Corn and sorghum are on a September 1 to August 31 marketing year. Barley and oats are on a June 1 to May 31 marketing year. Table 2--Feed and residual use of wheat and coarse grains ------------------------------------------------------------------------------ Year Feed Total Animal Feed/ Beginning Corn Sorg. Barley Oats Grains Wheat grains units animal September 1 unit ------------------------------------------------------------------------------ -------------------Million ---------------------- Mil. Tons 1992/93 Sep-Nov 46.3 6.8 0.3 0.5 53.9 -2.2 51.7 Dec-Feb 36.0 1.7 1.0 0.8 39.4 0.1 39.5 Mar-May 29.4 2.0 0.5 0.6 32.5 -2.0 30.5 Jun-Aug 22.8 1.4 2.0 1.3 27.5 8.1 35.6 Mkt. yr. 134.5 11.9 3.8 3.2 153.4 3.9 157.3 82.7 1.90 % Change 8.6 25.3 -23.5 -8.4 8.2 -37.9 6.2 2.5 3.63 1993/94 Sep-Nov 43.3 5.6 0.6 0.5 50.1 -1.0 49.0 Dec-Feb 31.7 2.7 1.8 0.8 37.1 1.1 38.1 Mar-May 24.2 2.1 0.9 0.5 27.6 -0.7 27.0 Jun-Aug 20.3 1.0 2.7 1.5 25.5 10.2 35.7 Mkt. yr. 119.5 11.5 5.9 3.4 140.3 9.6 149.8 84.0 1.78 % Change -11.2 -3.4 56.5 7.1 -8.5 145.2 -4.7 1.6 -6.2 1994/95 Sep-Nov 51.2 5.4 0.7 0.6 57.9 -0.8 57.1 Dec-Feb 38.1 2.0 1.1 0.6 41.8 0.7 42.5 Mar-May 29.6 1.7 0.5 0.5 32.2 -0.8 31.4 Jun-Aug 21.7 1.1 2.5 1.2 26.5 8.3 34.8 Mkt. yr. 140.6 10.2 4.75 2.8 158.4 7.5 165.8 84.6 1.96 % Change 17.7 -11.2 -19.7 -15.6 12.9 -22.1 10.7 0.8 9.8 1995/96 Mkt. yr. 114.9 7.6 4.1 2.5 129.2 7.3 136.6 86.7 1.58 % Change -18.2 -25.3 -12.6 -10.9 -18.4 -2.0 -17.6 2.4 -19.6 ------------------------------------------------------------------------------ Table 3--Grain shipments and rates ------------------------------------------------------------------------------- 1993/94 ---------1994/95---------- ----1995/96---- Mkt. Yr. Mkt. Yr. Sep-Oct Oct Sept-Oct Oct ------------------------------------------------------------------------------- Barge shipments 1/ 2.8 3.1 2.4 2.9 3.8 3.7 (Million ton/month) Barge rate index 2/ 93.6 160.7 168.1 183.5 214.5 206.2 (Dec 1984 = 100) Railcar loadings 3/ 25.3 28.4 27.6 30.0 30.5 29.8 (1,000 cars/week) Rail rate index 2/ 115.2 116.4 115.7 116.7 116.7 117.7 (Dec 1984 = 100) ------------------------------------------------------------------------------- 1/ Illinois & Mississippi rivers. Includes soybeans and all grains. Source: U.S. Army Corps of Engineers 2/ Source: Bureau of Labor Statistics 3/ Includes soybeans and all grains. Source: Association of American Railroads. Table 4--Cash feed grain prices ------------------------------------------------------------------------------ Corn, Corn, Sorghum, Sorghum, Barley, Barley, Oats, No. 2, No. 2, No. 2, Yel No. 2, No. 2, No. 3 or No. 2, Yel, Yel, Texas Yel, feed, better, Heavy Ctrl. Gulf South Gulf Duluth Malting, white, IL ports Panhandle ports Minn. Minn. 1/ 1/ 1/ 1/ 2/ 2/ 2/ ------------------------------------------------------------------------------ Mkt. yr. $/bu $/bu $/cwt $/cwt $/bu $/bu $/bu 92/93 2.12 2.46 4.06 4.27 2.11 2.37 1.58 93/94 2.55 2.85 4.95 4.90 2.05 2.48 1.55 94/95 3/ 2.34 2.78 4.75 4.73 2.02 2.75 1.36 Monthly: 1994 Jul 2.19 2.51 4.46 4.28 2.02 2.57 1.36 Aug 2.13 2.44 4.46 4.41 1.99 2.46 1.44 Sep 2.08 2.48 4.41 4.16 2.04 2.57 1.44 Oct 1.92 2.44 4.25 4.19 1.95 2.81 1.44 1995 Jul 2.79 3.23 5.61 5.41 2.25 3.69 1.92 Aug 2.68 3.21 5.53 5.38 2.09 3.22 1.96 Sep 2.83 3.32 5.84 5.78 2.06 3.58 2.04 Oct 3.12 3.57 6.15 6.22 2.58 3.69 2.11 ------------------------------------------------------------------------------ 1/ Marketing year beginning September 1-August 31. 2/ Marketing year beginning June 1-May 31. 3/ Preliminary. Table 5--Selected feed and feed by-product prices ------------------------------------------------------------------------------- Soybean Cotton- Corn Corn Meat & Dists.' Wheat Alfalfa meal seed gluten gluten bone dried midlgs, farm 44% slv. meal, feed, meal, meal, grains, Kansas price Decatur, 41% slv. IL IL Central Lawrence- City IL Memphis pts. pts. U.S. burg, IN 1/ 1/ 1/ 1/ 1/ 1/ 1/ 2/ ------------------------------------------------------------------------------- -------------------------------$/ton------------------------------- Mkt. yr. 92/93 180.80 159.22 95.95 284.60 220.93 122.84 69.69 78.20 93/94 181.82 168.36 88.62 286.61 206.81 123.79 81.51 89.30 94/95 3/ 151.77 112.64 82.77 221.95 170.51 106.70 65.04 93.00 Monthly: 1994 Jul 168.10 152.50 92.00 263.75 187.75 120.00 69.90 88.00 Aug 165.60 144.50 91.50 252.30 182.00 NQ 72.70 89.90 Sep 162.50 145.00 90.40 235.60 188.75 120.00 73.10 89.50 Oct 156.40 134.40 89.25 226.90 184.60 121.25 69.00 91.40 1995 Jul 160.10 116.90 81.90 218.75 159.80 101.00 61.80 86.30 Aug 157.50 116.50 79.40 232.00 157.40 NQ 71.90 85.20 Sep 171.75 137.60 81.60 250.00 166.70 112.00 88.10 85.00 Oct 183.40 153.25 98.40 290.50 221.00 121.70 93.40 88.10 ------------------------------------------------------------------------------- 1/ Marketing year beginning September 1-August 31. 2/ Marketing year beginning May 1-April 30. 3/ Preliminary. Table 6--Corn: Food and industrial uses --------------------------------------------------------------------------- Glucose Cereals and -----Alcohol--- & other Total Year HFCS dextrose Starch Fuel Beverage products F&I --------------------------------------------------------------------------- Million bushels 1992/93 Sep-Nov 92.33 54.45 58.83 104.36 20.70 29.17 359.84 Dec-Feb 88.36 47.21 57.70 107.47 20.50 28.85 350.09 Mar-May 110.36 55.06 59.34 110.91 21.15 29.64 386.46 Jun-Aug 122.99 57.74 62.16 102.77 20.95 29.64 396.25 Mkt year 414.04 214.47 238.03 425.51 83.30 117.30 1492.65 1993/94 Sep-Nov 98.23 55.79 61.71 112.23 20.69 29.42 378.08 Dec-Feb 95.00 49.58 57.60 119.33 20.47 29.10 371.07 Mar-May 117.68 56.79 61.57 112.44 20.92 29.74 399.15 Jun-Aug 131.28 60.89 62.66 114.26 20.92 29.74 419.74 Mkt year 442.18 223.05 243.54 458.26 83.00 118.00 1,568.04 1994/95 Sep-Nov 104.16 58.79 62.63 134.45 20.84 29.42 410.28 Dec-Feb 99.91 51.52 60.12 141.50 20.61 29.10 402.76 Mar-May 123.28 58.49 61.45 137.73 21.07 29.74 431.77 Jun-Aug 134.77 62.41 62.65 119.11 21.07 29.74 429.75 Mkt year 462.11 231.21 246.84 532.79 83.60 118.00 1,674.55 1995/96 Mkt year 470.00 235.00 245.00 530.00 81.80 118.00 1,679.80 --------------------------------------------------------------------------- Table 7--Wholesale corn milling product and by-product prices ------------------------------------------------------------------------------ Corn meal, Brewers' Sugar, HFCS, 42% Corn yellow, grits, destrose, tank cars, starch, New York Chicago Midwest Midwest fob Midwest ------------------------------------------------------------------------------ $/cwt $/cwt cents/lb cents/lb $/cwt Mkt. yr. 1/ 92/93 13.39 9.68 24.50 13.30 10.70 93/94 14.49 10.98 25.44 14.63 12.61 94/95 2/ 13.17 10.55 25.74 13.29 12.18 Monthly 1994 Aug 12.91 10.36 26.00 15.85 11.96 Sep 12.94 10.39 26.00 15.24 11.69 Oct 12.93 10.38 26.00 12.80 11.78 Nov 12.92 10.37 25.88 12.80 11.39 1995 Aug 13.80 11.25 25.50 11.80 13.85 Sep 14.34 11.80 25.50 11.80 13.67 Oct 14.76 12.23 25.50 12.55 13.94 Nov 2/ 14.87 12.34 25.50 13.30 14.36 ------------------------------------------------------------------------------ 1/ Marketing year beginning September 1-August 31. 2/ Preliminary. Table 8--U.S. feed grain exports by selected destinations 1/ ------------------------------------------------------------------------------ Country/region ------1993/94------ ------1994/95------ 1995/96 Sep-Aug Sept. Sep-Aug Sept. Sept. ------------------------------------------------------------------------------ CORN --------------------Thousand tons--------------------- Japan 12,322 1,308 15,849 1,018 1,276 Taiwan 5,077 594 6,027 473 656 Former USSR 2,909 294 140 25 0 South Africa 12 0 187 0 0 Sub-Saharan Africa 394 18 449 16 69 EU 1,765 32 2,836 1 526 Egypt 1,553 283 2,569 166 206 Canada 603 60 1,096 97 136 China 0 0 3,240 0 749 East Europe 48 0 112 0 0 Algeria 1,176 148 1,000 154 0 S. Korea 508 34 8,005 157 1,073 Mexico 1,468 38 2,985 248 429 Others 5,813 712 10,723 575 1,238 Total 33,649 3,522 55,218 2,930 6,357 SORGHUM Mexico 2,972 157 2,557 303 290 Japan 1,640 171 2,050 213 150 Others 432 42 1,008 55 168 Total 5,044 369 5,615 571 609 ---------------------------------------------------------- ------1993/94--- ------1994/95------ 1995/96 Mkt. yr. June-Sep Mkt. yr. June-Sep June-Sep BARLEY ---------------------------------------------------------- Saudi Arabia 344 3 203 0 0 Israel 335 143 468 199 42 Jordan 251 101 51 51 0 Others 504 130 671 244 414 Total 1,433 377 1,392 494 457 ------------------------------------------------------------------------------ Totals may not add due to rounding. Source: Bureau of the Census Table 9--U.S. imports by country of origin ------------------------------------------------------------------------------ Country/region ------1993/94--- ------1994/95------ 1995/96 Mkt. yr. June-Sep Mkt. yr. June-Sep June-Sep ------------------------------------------------------------------------------ OATS --------------------Thousand tons--------------------- Canada 1,011 247 1,161 390 534 Finland 526 204 374 117 8 Sweden 303 0 70 26 62 Other 0 0 0 0 0 Total 1/ 1,840 450 1,605 533 604 BARLEY, MALTING Canada 453 30 715 247 215 Other 0 0 0 0 0 Total 1/ 453 30 716 247 215 BARLEY, OTHER 2/ Canada 1,098 71 702 343 73 Other 5 0 16 10 5 Total 1/ 1,103 72 719 353 78 ------------------------------------------------------------------------------ 1/ Totals may not add due to rounding. 2/ Mainly consists of barley for feeding, includes seed barley starting January 1994. Source: Bureau of the Census END-END-END