-January corn for ethanol data supports potential need for USDA upward revision
-December corn for ethanol usage revised lower
USDA reported 474.0 million bushels of corn was used for ethanol production in January vs 477.9 million in December, 417.0 million bushels last year in January and falling just short of record usage in January of 476.1 million bushels in 2018. Through the first five months of 2021/22, marketing year-to-date corn for usage of 2.294 billion bushels compares to 2.116 billion last year, up 178 million bushels (+8.4%) so far. Based on the USDA’s 5.325 billion bushel annual estimate, Feb-Aug corn for ethanol usage would need to total 3.031 billion bushels vs 2.916 billion bushels during the same period last year, a 4.0% (115 million bushel) increase. Despite the notable decline in ethanol margins of late, ethanol production continues to run at a rather respectable pace and easily justifying the USDA’s current 2021/22 corn for ethanol usage estimate. In fact, unless production begins to slow, we will be anticipating the USDA’s estimate needing a bump higher sooner than later. This is despite December corn for ethanol usage being revised lower to 478 million bushels from 486 million originally reported when last month’s data was initially released. We would not be surprised if January usage eventually gets bumped a bit lower, as well, though, as the implied ethanol/corn yield of 2.86 gallons/bushel is modestly below the 2.91 average in recent months, similar to what was originally implied for the December yield, as well, but got bumped higher with the lower corn for ethanol usage during the month. USDA reported 1.929 million tons of DDGS were produced in January vs 2.073 million tons in December and 1.753 million last year, bringing corn marketing year to date production to 9.71 million tons vs 8.91 million during the same period last year.
