Feed YEARBOOK -- SUMMARY April 27, 2007 April 2007, ERS-FDS-2007s Approved by the World Agricultural Outlook Board ----------------------------------------------------------------------------- This SUMMARY is published by the Economic Research Service, U.S. Department of Agriculture, Washington, DC 20036-5831. The text of the yearbook will be available electronically about 1 week following this summary release. ----------------------------------------------------------------------------- CORN AND SORGHUM PRICES RISE IN 2006/07 U.S. total feed grain disappearance for 2006/07 is projected at 311 million tons, up from 304 million in 2005/06. Food, seed, and industrial (FSI) use is forecast at a record 95 million tons, boosted by ethanol demand. Exports are projected at 61 million tons, up from 60 million last year. The expected growth in utilization will exceed the growth in supply, leaving ending stocks less than half their 2005/06 level. Feed and residual use of the four feed grains plus wheat in September-August 2006/07 is expected to be up 312,000 metric tons from the 165.6 million tons used in September-August 2005/06. The grain used per grain-consuming animal unit (GCAU) in 2006/07 is nearly unchanged from 2005/06 at 1.81 tons. Corn is expected to represent 90 percent of feed and residual use in 2006/07, down 4 percent from 2005/06. U.S. corn production in 2006/07 was 10.5 billion bushels, down from last year’s crop of 11.1 billion bushels, but still the third largest crop on record. The year-to-year decrease stems from a 3.5-million-acre decrease in planted area and a 4.5-million-acre decrease in area harvested for grain. The 2006/07 yield was 149 bushels per acre, up from 148 bushels per acre in 2005/06. Beginning 2006/07 corn stocks were 1,967 million bushels, down 147 million from the previous year. Projected 2006/07 total corn supply is 12,512 million bushels, down 725 million bushels from the previous year. Total corn utilization in 2006/07 is projected at a record 11,635 million bushels, up from 11,270 million in 2005/06. Utilization is forecast up for FSI and exports but down for feed and residual. With utilization higher than supply, ending stocks are projected to decrease 1,090 million bushels to 877 million bushels, the lowest ending stocks since 1995/96. The season average farm price is projected at $3.00-$3.20 per bushel, up sharply from $2.00 per bushel in 2005/06. Corn FSI use in 2006/07 is expected to total 3,535 million bushels, up from 2,981 million in 2005/06. FSI use would represent 30 percent of total corn use, up from 26 percent in 2005/06 and 25 percent in 2004/05. Corn used to make ethanol for 2006/07 is forecast at 2,150 million bushels, up 34 percent from 2005/06. In January 2007 (latest data available), ethanol production reported by the Department of Energy (DOE) was 375,000 barrels per day, up from 288,000 barrels in January 2006 as new plants have come on stream. The 2006/07 sorghum crop was 278 million bushels, down from 393 million in 2005/06. Lower harvested area and yields are responsible for this year-to-year change. Total 2006/07 supply is 343 million bushels, down from 450 million in 2005/06. Total sorghum utilization is projected at 295 million bushels, down from 384 million last year. All uses of sorghum are expected to be down from last year. Ending stocks in 2006/07 are expected to be 48 million bushels, down from 66 million a year earlier. The season average farm price is projected at $3.20-$3.40 per bushel. Barley production in 2006/07 was 180 million bushels, down from 212 million in 2005/06. Harvested area in 2006/07 was 3.0 million acres, down from 3.3 million acres in the previous year. The national average barley yield decreased from 64.8 bushels per acre in 2005/06 to 61.0 bushels per acre in 2006/07, further adding to the decline in production. Total forecast barley supply for 2006/07 is 303 million bushels, down from 346 million bushels the previous year. Total barley use is forecast at 235 million bushels in 2006/07, down from 238 million in 2005/06. The year-to-year change stems from slight declines in FSI use and exports as feed and residual use is up slightly. Barley ending stocks for 2006/07 are forecasted at 68 million bushels, down from 108 million bushels a year earlier. The season average barley farm price for 2006/07 is forecast at $2.88 per bushel, compared with $2.53 per bushel for 2005/06. Total oats supply in 2006/07 is forecast at 251 million bushels, down from 264 million in 2005/06. Lower beginning stocks and production are the primary difference in the supply, which is down 13 million bushels from a year earlier. Total 2006/07 oats utilization is projected at 202 million bushels, down 9 million bushels from 2005/06 and the lowest level on record. Ending stocks for 2006/07 are forecast at 49 million bushels, down from 53 million the previous year. Average oats prices received by farmers in 2006/07 are expected to be $1.85 per bushel, up from $1.63 per bushel a year earlier. The March 30 Prospective Plantings report indicated that producers intend to plant 90.5 million acres of corn in 2007. If realized, this would be up 15 percent from 2006 and the largest planted area since 1944. Sorghum growers intend to plant 7.1 million acres, up 9 percent from last year. Barley growers intend to plant 3.7 million acres for 2007, up 7 percent from a year earlier. Oats growers intend to plant 4.0 million acres, down 3 percent from a year earlier, and, if realized, the lowest planted acreage on record. Hay production for 2006 was estimated at 142 million tons, down from 151 million tons in 2005. Acreage harvested in 2006 was 60.8 million acres, down from 61.7 million in 2005. Average 2006 yield for hay was 2.33 tons per acre, down 0.12 tons per acre from the previous year. Stocks of all hay on farms totaled 96 million tons on December 1, 2006, down 8 percent from the previous year. Prices for all hay are up in 2006/07. According to the March 31 Prospective Plantings report, producers expect to harvest 63.1 million acres of all hay in 2007, up 2.2 million from 2006. Record world corn trade is projected for 2006/07 as import demand remains strong despite high prices. U.S. corn exports for the October-September 2006/07 trade year are forecast at 56.0 million tons, nearly the same as the previous year. Competition from Argentina was down early in the trade year due to a small corn crop there in 2006, but it is expected to increase in the later months after Argentina’s harvest in March and April 2007. Corn exports from South Africa are expected to decline in 2006/07. World coarse grain consumption is expected to increase 3 percent in 2006/07, exceeding 1 billion tons for the first time. This is the fourth straight year of demand growth. Increasing global consumption of coarse grains is expected to reduce world ending stocks 26 percent to 123 million tons in 2006/07, the lowest level in over 30 years. World coarse grain production in 2006/07 is expected to decline less than 1 percent from the level of the previous year. Foreign coarse grain production is forecast up 2 percent as South America’s production leaps 22 percent and Sub- Saharan Africa’s production increases 7 percent despite devastating drought in South Africa. China is having another record coarse grain crop, up 3 percent over 2005/06. These increases more than offset another poor crop in the EU-25 in 2006/07, down 4 percent from 2005/06, and a 51-percent drought-induced plummet in Australia. Global beginning stocks of coarse grains in 2006/07 were estimated down 7 percent from the previous year, following strong growth in use in 2005/06. Reduced beginning stocks and slightly lower production leave global coarse grain supplies in 2006/07 down year-to-year.