USDA Raises Ethanol Corn Use Forecast, Lowers Price Outlook for 2023-24 Season

In its most recent World Agricultural Supply and Demand Estimates report released on April 11, 2024, the USDA raised its projection for corn use in ethanol production for the 2023-’24 period. Additionally, the agency revised its forecast for the season-average corn prices.

This month's 2023-’24 corn outlook not only raises the forecast for ethanol use but also predicts higher use for feed and residual purposes while lowering the projection for corn-ending stocks.

Based on the data from the USDA’s Grain Crushing and Co-Products Production report through February, along with the U.S. Energy Information Administration's weekly ethanol production data for March, corn usage for ethanol has been revised upward by 25 million bushels to reach 5.4 billion bushels.

In 2022-’23, corn usage for ethanol was at 5.176 billion bushels, while in 2021-’22, it stood at 5.32 billion bushels.

The USDA raised its forecast for feed and residual use by 25 million bushels to 5.7 billion, based on disappearance during the December-February quarter. With no alterations in supply but increased usage, ending stocks are reduced by 50 million bushels to 2.1 billion bushels. Consequently, the season-average farm price is decreased by 5 cents to $4.70 per bushel.