Ethanol demand reduces corn stocks

Higher gasoline prices might not be good for the travel industry, but it sure seems to be good for corn fundamentals.

USDA projected U.S. old crop corn ending stocks at 50 million bushels lower in its March 11 World Agricultural Supply and Demand Estimates and Crop Production Report.

The report said that higher ethanol use is expected to more than offset a reduction in U.S. exports. Corn use for ethanol is projected 100 million bushels higher on indications of improving blender incentives and higher ethanol use.

Blender margins have become increasingly favorable since late February as gasoline prices have risen relative to those for ethanol, USDA says. A continuing recovery in weekly production of gasoline blends with ethanol is also supportive of ethanol demand.
SouthEastFarmPress