(August 12, 2013) WASHINGTON — The U.S. Department of Agriculture (USDA) today projected that farmers will harvest a record corn crop of 13.76 billion bushels in 2013, up 28 percent from last year and 5 percent larger than the previous record crop. USDA expects that farmers will achieve a national average yield of 154.4 bushels per acre; that would be the third-highest yield on record, despite farmers experiencing one of the slowest, wettest planting seasons on record.
"America's farmers have again risen to the challenge of producing abundant feed, food, and fuel for consumers around the world. After the disappointment of last year's drought-stricken crop, farmers have responded by producing what is likely to be the largest crop of all time," said RFA President and CEO Bob Dinneen. "By rapidly adopting new seed and equipment technologies over the past decade, this country's corn growers have distinguished themselves as the most productive in the world."
Dinneen continued, "While it is important to remember the crop is not yet in the bins, today's report should be the last nail in the coffin of the ridiculous 'food versus fuel' argument. Corn stocks are likely to hit an 8-year high and prices are at a 3-year low. Meanwhile, USDA is projecting food inflation to average just 2 percent in 2013, down from 2.6 percent in 2012 and well below the historical average of 3 percent. Meat prices are expected to advance just 1.5 percent this year, compared to 3.4 percent last year. All this while ethanol production, demand, and consumption continues to increase. Clearly, the link between the RFS, ethanol, and food prices does not exist."
Dinneen noted that USDA's report suggests livestock and poultry feed will remain as the top use of corn, accounting for 53 percent of total demand (when animal feed co-products from ethanol production are properly considered). By comparison, the ethanol industry is projected to account for 26 percent of corn demand on a net basis, exports will account for 10 percent, and food, seed, and industrial use will make up 11 percent. Additionally, feed usage is projected to be 15 percent higher than last year.
USDA expects global grain production to hit 2.43 billion metric tons in 2013, up 8 percent from last year and a new record. "Not only is U.S. corn production expected to achieve a new record, but world grain output is projected to soar to a new record as well," Dinneen said. "Simply put, there isn't a grain of truth to the notion that U.S. ethanol or the RFS are having any kind of meaningful impact on American or world food prices."
Source: Renewable Fuels Association