Market Reaction: December 2017 corn futures closed down 6 cents at $3.51 ½ with a trading range for the day of $3.45 ½ to $3.57 ¼. December 2018 corn futures closed down 5 cents at $3.93 ¾ with a trading range for the day of $3.88 to $3.98. USDA provided a yield surprise which drove prices lower. Most pre-report estimates were for USDA to lower yields 1-2 bu/acre. The report saw a 0.4 bu/acre increase. Initial reaction saw prices down 10-12 cents before a late session rebound.
USDA Summary: This month’s 2017/18 U.S. corn outlook is for increased production, greater feed and residual use, higher ending stocks, and lower prices. Corn production is forecast at 14.184 billion bushels, up 32 million from last month. Corn supplies are up from last month, as a larger crop more than offsets a small decline in beginning stocks due to updated use estimates for 2016/17. Feed and residual use for 2017/18 is raised 25 million bushels with a larger crop and lower expected prices. Corn used for ethanol for 2017/18 is projected down 25 million bushels at 5.475 billion, based on observed usage during 2016/17 and expectations of lower exports. Other industrial use is lowered 50 million bushels. With supply increasing and use falling, corn ending stocks are up 62 million bushels from last month. The projected range for the season-average corn price received by producers is lowered 10 cents on both ends to a range of $2.80 to $3.60 per bushel. continue reading at UT Monthly Crop Comments.