No US Corn Shortage Seen Yet Despite Ethanol Demand

The amount of corn used for ethanol continues to climb but the supply of corn is beginning to rebound a bit as livestock feeders seek cheaper sources of animal feed, such as feed wheat, analysts said on Tuesday.

No one is saying the food-versus-fuel debate will go away, but for now it appears the intensity is easing a little, they said.
“There is a little more breathing room, but the reality is that this year isn’t the problem, the problem is next year,” Jerry Gidel, analyst for North America Risk Management Inc., said, referring to a potential sharp drawdown in the US corn supply during 2008.

The US Department of Agriculture said Tuesday the amount of corn in the United States at the end of the current 2006/07 marketing year on Aug. 31 would total 877 million bushels.

That’s still less than half the carryout from last year of nearly 2 billion bushels, yet it was more than 100 million bushels more than the USDA’s February forecast of 752 million.

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