U.S. cotton ending stocks now sit at a record low 1.6 million bales, while rice ending stocks are at their highest levels since 1985-86, according to USDA’s monthly supply-demand report, issued Friday.
The USDA reduced old crop -- 2010 -- cotton ending stocks to 1.6 million bales versus 1.9 million in the March estimate. Last year's production was lowered 215,000 bales and mill use was increased 100,000 bales. Exports were unchanged.
“The record low ending stocks have pushed prices to historic highs -- the highest in 150 years,” said Scott Stiles, Extension economist-risk management. “Old crop prices were trading around $2 and 2011 prices were at $1.37 this morning after trading as high as $1.44 this week.
“These prices are the result of tight ending stocks. The lower 2011 prices are based on the assumption producers will respond by planting more cotton this year. As revealed last week, Arkansas producers plan to plant 85,000 more acres. U.S. acreage is expected to increase 1.59 million – or 15 percent.”
World cotton ending stocks were lowered to 41.55 million bales on lower production and higher consumption.
Corn ending stocks were unchanged at 675 million bushels.
“Some minor adjustments were made to demand with feed use lowered by 50 million bushels, but corn used for ethanol was increased 50 million bushels,” Stiles said. “Pre-report guesses slanted toward the USDA cutting 2010-11 ending stocks to 595 million bushels.”
The average pre-report estimate for soybean ending stocks was 136 million bushels, down 4 million from last month.
“USDA left ending stocks at 140 million bushels, decreasing exports slightly, increasing residual for a net of unchanged stocks,” Stiles said. “USDA pegged Brazilian soybean production at 72 million metric tons and left Argentina's soybean production unchanged at 49.5 million metric tons.”
The USDA projected all rice ending stocks at 54.8 million hundredweight, 2 million above last month, 18.1 million above the previous year, and the largest stocks since 1985-86. Long-grain and combined medium- and short-grain rice stocks are each raised 1 million hundredweight to 43.9 million and 9.4 million, respectively. Supply numbers were left unchanged. Long-grain domestic use was lowered. Medium- and short-grain exports were reduced.
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