USDA is projecting smaller crops for U.S. cotton, corn and soybeans in its July World Agricultural Supply and Demand Estimates.
Projected U.S. 2008-09 cotton production was reduced 500,000 bales to 14 million bales based on slightly lower planted area and slightly higher abandonment, reflecting conditions in Texas.
Domestic mill use was raised 100,000 bales to 4.4 million bales. Despite the slowing economy, several factors are supporting domestic mill use, including higher overseas transportation costs, the weaker dollar, and payments to mills included in the Food, Conservation, and Energy Act of 2008.
The export forecast was reduced 500,000 bales due to lower U.S. supplies and lower foreign import demand.
Projected world cotton production was reduced about 1.5 million bales due mainly to reductions in India and the United States. USDA also projects a decrease of nearly 1.3 million bales in world consumption, mainly in China, India, and Turkey, due to indications of slower growth with sluggish world economic conditions. Projected world ending stocks were reduced about 1.6 percent from June projections.
U.S. 2008-09 corn production is projected 20 million bushels lower than in June at 11.715 billion bushels as projected yield was lowered by half a bushel per acre. Ending stocks are projected 160 million bushels higher at 833 million bushels.
The tighter balance sheet for soybeans and higher soybean prices are expected to drive competition for 2009 acreage, keeping cash and futures corn prices relatively strong, but below recent record levels.
Ending stocks for 2007-08 are projected 165 million bushels higher. Ethanol corn use for 2007-08 was lowered 50 million bushels based on reported delays in plant startups and construction, as well as lower expected plant capacity utilization.
Globally, corn imports were raised for Canada and North Korea, but lowered for EU-27 and South Korea.
U.S. soybean production is projected at 3 billion bushels, down 105 million bushels from the previous month due to reduced harvested area and yield. Harvested area is 1.7 million acres below June projections due to flooding and excessive moisture throughout much of the Midwest during the planting season. Soybean yield is projected at 41.6 bushels per acre, down a half bushel from last month. Projected 2008-09 ending stocks are 140 million bushels, down 35 million bushels from last month.
U.S. winter wheat production is forecast up 47 million bushels mostly on higher soft red winter production.
The first survey-based production forecast for spring wheat (including durum) is 596 million bushels, up 8 percent from last year, but 18 million bushels lower than last month’s projection.
U.S. wheat ending stocks for 2008-09 are projected at 537 million bushels, up 50 million from last month.
Global 2008-09 wheat production is projected at a record 664 million tons, up 1.3 million tons from last month and 53 million tons higher than the weather-reduced 2007-08 crop. Higher production is projected for Australia, EU-27, and the United States.
Production for Iran was cut 2 million tons as extreme, prolonged drought in the major rain-fed growing areas has sharply reduced output.
World wheat ending stocks are projected 1 million tons higher with increases for the United States and Australia.