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March corn stock levels higher than anticipated

When the United States Department of Agriculture released its Grain Stocks report on March 28, the amount of corn stocks on hand even surprised the USDA itself.

When the United States Department of Agriculture released its Grain Stocks report on March 28, the amount of corn stocks on hand even surprised the USDA itself.

Corn stocks on March 1 totaled 5.4 billion bushels. While that amount is still 10 percent lower than it was one year ago, it was only down 2.63 billion bushels from December 2012, compared to a drop of 3.62 billion bushels from the same period one year ago.

“That implies if you just subtract the March stock number from the December stock number, we have essentially an implied use of around 2.6 billion bushels, and that’s the lowest implied disappearance since 2002,” Joe Glauber, USDA chief economist said during an agency broadcast. “We’re going to be looking at that. I’m sure the trade will be looking at those numbers, trying to figure out exactly what that means.”

The lower disappearance rate for corn was quickly noticed in the markets, offering signs of optimism for the poultry and livestock industries that rely on the corn for feed. Just after the grain stocks report was released, corn futures dropped 5 percent, which is the biggest daily drop for the commodity since May 2012. 

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