ERS Charts of Note
Wednesday, September 5, 2018
The United States is on track for another record-setting year of corn yields. USDA’s first survey-based yield forecast of the 2018/19 corn crop reported a yield gain of 4.4 bushels per acre to a record 178.4 bushels. This eclipses the record set during the 2017/18 marketing year (September-August). Over the long term, corn yields trended upward with limited interruption until 2010/11 when a severe drought impacted much of the Southern and Central United States. The drought continued through 2012/13 when yields reached their lowest point since 1995/96 at 123.1 bushels per acre. Since then, yields per acre have recovered significantly and are now on track for three consecutive record years. While per acre yields have reached new heights, the number of acres of corn harvested has declined slightly over the same period. As a result, total U.S. corn production in 2018/19 is projected to be just the third highest on record. This chart appears in the latest ERS Feed Outlook newsletter, released in August 2018.
Thursday, July 5, 2018
U.S. corn exports reached an all-time high in April at 7.7 million metric tons. Year-to-date corn shipments through May are estimated at 29 million metric tons, and USDA projections for exports in the 2017/18 crop marketing year (September-August) were raised to 58.4 million metric tons. The previous monthly record for exports was set in November 1989, nearly 30 years ago. Projections for May exports, based on export inspections, are higher than usual at this time of year, suggesting continued strength in the U.S. corn export market. This is due, in part, to continued drought in Argentina, a major corn supplier, reducing export prospects there. Additionally, Brazil is expected to have a poor crop, reflecting dry weather and less area planted for the second cropping season. As a result, importing countries have fewer options for sourcing corn, increasing U.S. competitiveness. A version of this chart appears in ERS’s Feed Outlook: June 2018 newsletter.
Thursday, October 5, 2017
Brazil, the world’s second largest ethanol producer after the United States, plays a large role in U.S. ethanol markets. Not only is Brazil one of the nation’s customers, it is also a competitor and a supplier. Brazilian ethanol is derived from sugar, which is desirable because it is categorized as an advanced biofuel under the renewable fuel standard. Through July of this year, the United States exported 770 million gallons of ethanol, with 40 percent of it going to Brazil. Of the 24 million gallons of ethanol imported into the United States, nearly all originated in Brazil. During this period, the Brazilian government took measures to lower fuel prices, causing sugar mills to switch from producing ethanol to sugar, because of higher returns. The resulting ethanol shortage has been filled by expanding imports from the United States. In response, the Brazilian government announced the imposition of a 20-percent duty on U.S. ethanol imports above the tariff rate quota of 160 million gallons (less than 4 months of shipments at current export levels). This will sharply reduce the competitiveness of U.S. corn-starch ethanol in Brazil and significantly reduce U.S. exports. Brazil is also implementing a new energy policy, called RenovaBio, which will increase ethanol production and consumption as part of greenhouse gas reduction commitments made under the 2015 Paris Climate Conference. This chart is drawn from the ERS Feed Outlook newsletter, released in September 2017.
Tuesday, June 6, 2017
Corn planted area changes are uneven among the regions in the world, and the fastest to expand its corn area is by far the Former Soviet Union (FSU) region. The majority of the growth comes from Ukraine and Russia, countries that produced little corn in the past. Importantly, these countries have also become significant, albeit smaller, corn exporters, with combined exports increasing twelvefold over the last decade. Policy changes in the early 90s required farms to be self-financing and gave farmers decision-making freedom that allowed them to switch to more profitable crops like corn, sunflower seed, and soybeans, at the expense of rye, barley, oats, and pastures. Ukraine and Russia became more integrated into the world agricultural economy, such that trade, foreign agricultural investment, and technology transfer all expanded. All these developments have helped to drive the expansion of corn area and yields. As corn area and yields have grown, the FSU region has increased its share of global corn production from 1 percent in 1997-01 up to 5 percent in the 2017 forecast. Though their corn output is still small compared to the largest world producers (North America is expected to produce 38 percent of global corn in 2017), Ukraine has become a major corn exporter, behind the United States, Brazil, and Argentina. This chart appears in the ERS Feed Outlook Newsletter, released in May 2017.
Monday, October 10, 2016
USDA's Average Crop Revenue Election Program (ACRE) is an alternative to price-based commodity programs. Begun in 2009, the program uses a combination of State- and farm-level revenue guarantees that are determined from recent historic prices and yields. The ACRE program makes payments to producers when both State average revenue and farm revenue for a crop fall below recent historic levels. The map shows expected ACRE payments, based on simulated crop revenue variability, per acre for representative farms (one per crop per county) relative to national average ACRE payments. For corn, ACRE payments would be high in Midwest areas with high average yields, even though these areas have low yield and revenue variability and strong negative price-yield correlations. ACRE payments also tend to be high along the Southeast and Middle Atlantic coast where average yields are low and yield and revenue variability are high. This map originally appeared in the December 2010 issue of Amber Waves.
Thursday, July 28, 2016
U.S. corn area in 2016/17 is estimated at 94.1 million acres, of which 86.6 million is expected to be harvested for grain, up 5.9 million from last year. With a national average yield forecast of 168 bushels, corn production this year would reach 14.5 billion bushels, 939 million bushels above last year’s harvest and 324 million more than was harvested from the record-large 2014/15 crop. The larger supply is expected to have a dampening effect on prices, making U.S. corn more competitive in the global market and boosting exports to 2.1 billion bushels in 2016/17, up from 1.9 million from the 2015/16 crop and the highest since 2007/08 when they reached 2.4 billion. Use for ethanol as well as other food, seed and industrial uses is expected to increase only modestly (less than 1 percent) to 6.7 million bushels, reflecting the maturity of those markets. Feed and residual use (a category that mainly includes livestock feed as well as other uses unaccounted for) is expected to consume 5.5 billion bushels, up 300 million from the 2015/16 crop. With projected supply expected to exceed total use of the 2016/17 crop, ending stocks are forecast to grow to 2.1 billion bushels, up from the 1.7 billion bushels expected to be on hand at the end of the 2015/16 crop year. This chart is from the ERS report Feed Outlook, July 2016.
Tuesday, July 19, 2016
Corn is Brazil’s second largest crop (after soybeans), accounting for 20 percent of planted area, and Brazil is the world’s second largest corn exporter, behind the United States. Due to a favorable climate and long growing season, double-cropping is possible in much of the country, and the majority of corn in Brazil is harvested as a second crop planted after soybeans. Brazil tends to use most of its first-crop corn (harvested primarily during February-April) domestically because it is grown near the poultry and pork enterprises in the South, and the transportation system is focused on moving soybeans into global markets. But second-crop corn is harvested during June-August just as Brazil’s peak soybean export period ends, freeing up port capacity and transportation resources to move corn into export markets. Second-crop corn production in Brazil has expanded rapidly over the past 5 years, and over the same period the seasonal pattern of Brazil’s corn exports has shifted such that a much larger portion now enters export markets from August to January, months when harvesting begins and supplies peak in the United States. This chart is from the ERS report, Brazil’s Corn Industry and the Effect on the Seasonal Pattern of U.S. Corn Exports, released June 15, 2016.
Thursday, July 7, 2016
The Government of Brazil has supported the production of ethanol as an automotive fuel for many years, beginning in 1975 with the Proálcool program, to encourage production of ethanol from sugarcane and including many programs that remain in effect today—including mandatory ethanol-blending requirements in gasoline and tax exemptions for ethanol-powered cars. Sugarcane is nearly the exclusive ethanol feedstock in Brazil, and Brazil is the world’s largest sugarcane producer, accounting for 39 percent of world production. Until the mid-1990s, the share of sugar production turned into ethanol was set by government policy, but since then market forces have determined the share that is converted to ethanol. In particular, the relationship among the prices of sugar, gasoline, and ethanol, as well as storage capacity at sugar mills, all play a role. Production of both sugar and ethanol in Brazil has expanded rapidly since the mid-1990s. Sugarcane production reached 640 million tons in 2014, up 188 percent since 1991, while over the same time, the share used for ethanol production declined from 72 percent in 1991 to a low of just over 49 percent in 2003 and a 2014 level of 55 percent. This chart is from the ERS report, Brazil’s Agricultural Land Use and Trade: Effects of Changes in Oil Prices and Ethanol Demand, released June 29, 2016.
Friday, June 24, 2016
The cost of producing agricultural commodities varies across countries and regions due to many factors, including the quality of resources, climatic conditions, and the cost and availability of necessary inputs. Differences in cost of production help to determine a country’s export competitiveness in global markets, with low-cost producers usually capturing a larger share of global exports. Corn and soybeans are among the most important agricultural commodities traded in global markets, and the United States, Brazil and Argentina are the leading exporters, accounting for a combined 88 percent of world soybean exports and 73 percent of world corn exports between 2008 and 2012. Based on data for 2010 and 5-year average yields, the cost of producing soybeans in Argentina average $8.81 per bushel, compared to $7.47 in Brazil and just over $8.00 in the United States. For corn, Brazil had the highest cost of production at $4.74 per bushel, compared to $3.93 for Argentina and $3.80 in the United States. This chart is from the ERS report, Corn and Soybean Production Costs and Export Competitiveness in Argentina, Brazil and the United States, released on June 22, 2016.
Tuesday, June 21, 2016
Since 2000/01, corn production in Brazil has doubled, reaching a record 85 million metric tons in 2014/15, equivalent to 8.4 percent of global corn production. Corn is now Brazil’s second largest crop (after soybeans), accounting for 20 percent of planted area, and Brazil is the world’s second largest corn exporter, behind the United States. Due to a favorable climate and long growing season, double-cropping is possible in much of the country, and the majority of corn in Brazil is harvested as a second crop planted after soybeans. Technological advances in soil management and improvements in hybrid corn varieties have supported this expansion. The second-crop corn harvest largely serves the export market, putting it in direct competition with the timing of the U.S. corn harvest. This chart is from the ERS report, Brazil’s Corn Industry and the Effect on the Seasonal Pattern of U.S. Corn Exports, released on June 15, 2016.
Thursday, May 5, 2016
U.S. production of ethanol hit a record 14.8 billion gallons in 2015, and when combined with the carry-over stocks from the previous year and 2015 imports, the total ethanol supply reached an all-time high of 15.7 billion gallons. Nearly all ethanol blended into the U.S. gasoline supply is produced domestically, and, over the past five years, about 94 percent of domestic production was used in the United States. Ethanol imports peaked in 2006 at 731 million gallons (equal to 12 percent of the U.S. supply), but each year since 2010 exports have exceeded imports, making the United States a net exporter of ethanol. The domestic market for ethanol is at full capacity due to the technical and regulatory constraints that limit most of the U.S. gasoline supply to a 10 percent maximum ethanol blend, so the export market is now the primary opportunity for growth. Ethanol exports peaked in 2011 at nearly 1.2 billion gallons, but have remained below 850 million gallons for the past four years. This chart is based on the ERS U.S. Bioenergy Statistics data product.
Monday, May 2, 2016
For weed control, U.S. corn and soybean farmers rely on chemical herbicides which were applied to more than 95 percent of U.S. corn acres in 2010 and soybean acres in 2012. Over the course of the last two decades, U.S. corn and soybean farmers have increased their use of glyphosate (the active ingredient in herbicide products such as Roundup) and decreased their use of herbicide products containing other active ingredients. This shift contributed to the development of over 14 glyphosate-resistant weed species in U.S. crop production areas. Glyphosate resistance management practices (RMPs) include herbicide rotation, tillage, scouting for weeds, and other forms of weed control. In some cases, ERS found that usage rates for RMPs increased from 1996 to 2012. In other cases, RMP use dropped from 1996 to 2005/06 but increased as information about glyphosate-resistant weeds spread. For example, herbicides other than glyphosate were applied on 93 percent of planted soybean acres in 1996, 29 percent in 2006, and then 56 percent in 2012. This chart is found in the April 2016 Amber Waves finding, “U.S. Corn and Soybean Farmers Apply a Wide Variety of Glyphosate Resistance Management Practices.”
Monday, April 4, 2016
Genetically engineered (GE) crops are now widely used to produce breakfast cereals, corn chips, soy protein bars, and other processed foods and food ingredients, and a market for foods produced without crops grown from GE seed has emerged. The Non-GMO Project is a private group that provides verification services for products made according to best practices for genetically modified organism (GMO) avoidance. In 2014, the Non-GMO Project Verified label appeared on nearly 12,500 products with unique universal product codes (UPC), up from fewer than 1,000 in 2010. Many of the food products verified under this protocol, and bearing the Non-GMO Project Verified butterfly logo, are not at risk of GE contamination: that is, they do not contain corn, soybeans, or other crops for which GE varieties are available. Also, over half of the products verified under this protocol are certified organic under USDA’s organic regulations, which already prohibit the use of genetic engineering in organic production and processing. Non-GMO Project Verified labeling currently accounts for most of the conventionally grown U.S. products that are non-GE verified. This chart appears in the ERS report, Economic Issues in the Coexistence of Organic, Genetically Engineered (GE), and Non-GE Crops, February 2016.
Wednesday, March 16, 2016
Ethanol production in the United States is based almost entirely on corn as a feedstock. Corn‑based ethanol production is projected to fall over the next 10 years. This reflects declining overall gasoline consumption in the United States (which is mostly a 10‑percent ethanol blend, E10), infrastructural and other constraints on growth for E15 (15‑percent ethanol blend), and the small size of the market for E85 (85‑percent ethanol blend), with less-than-offsetting increases in U.S. ethanol exports. Even with the U.S. ethanol production decline, demand for corn to produce ethanol continues to be strong. While the share of U.S. corn expected to go to U.S. ethanol production falls, it accounts for over a third of total U.S. corn use throughout the projection period. This chart is based on information in USDA Agricultural Projections to 2025.
Friday, February 26, 2016
U.S. farmers used genetically engineered (GE) seed varieties that contain traits to tolerate herbicides used for weed control and/or to resist other pests on over 90 percent of corn acreage in 2015. To receive the price premiums associated with organic and other non-GE crops, these producers must minimize the unintended presence of GE materials in their crops. Organic and other non-GE farmers use various practices—including the use of buffer strips to minimize pesticide/pollen drift and/or delaying crop planting until after any nearby GE crops are planted—to prevent their crops from commingling with GE crops. While some field crops are mostly self-pollinating, most corn pollination results from pollen dispersal by wind and gravity. In USDA’s most recent (2010) corn survey of conventional and organic producers in top corn producing States, delayed planting was reported on two-thirds of planted organic corn acreage. While this strategy helps protect against commingling of GE and non-GE crop pollen, growers may realize lower yields from planting at a suboptimal time. This chart is found in the ERS report, Economic Issues in the Coexistence of Organic, Genetically Engineered (GE), and Non-GE Crops, February 2016.
Thursday, January 21, 2016
Errata: On January 26, 2016, this chart was reposted to correct the data labels for ethanol and gasoline, which were switched in the original chart.Each gallon of automobile gasoline typically contains about 10-percent ethanol, reflecting a mandate under the Renewable Fuels Standard that specifies the volume of ethanol that must be blended into the Nation’s gasoline supply. The steep decline in crude oil prices over the past 18 months has pushed the price of many conventional fuels down by more than 50 percent, including gasoline, which has fallen to price levels not seen since 2007. The price of ethanol has also fallen, driven primarily by the more than 50-percent decline in the price of corn—the primary ethanol feedstock—since summer 2013. Although ethanol is not derived from crude oil, its price is still influenced by the price of gasoline (as well as the price of corn) since ethanol and gasoline can substitute as an energy source, and as an oxygenate or octane booster, ethanol competes against petroleum-based alternatives. The price of ethanol is usually below the price of gasoline because of ethanol’s lower energy content, but the most recent data show wholesale gasoline prices falling slightly below the price of ethanol. This pattern, if it continues, suggests further downward pressure on ethanol prices. This chart is from the USDA/ERS U.S. Bioenergy Statistics data set.
Friday, December 18, 2015
Sorghum is a common feed grain that can substitute for corn in livestock feed rations and in the production of ethanol. Corn tends to be preferred over sorghum as a feed ingredient, so sorghum typically sells at a discount compared to corn in global markets. Throughout much of the 2014 marketing year (September-August) this situation reversed, and due in large part to strong demand from China, sorghum began selling at a premium over corn, at times exceeding 20 percent. As a result, sorghum use for ethanol production declined while acreage for the 2015 harvest increased to result in a record-large U.S. crop. This, combined with recent changes in China’s import policy that could reduce U.S. sorghum’s export prospects for the 2015 crop, has greatly increased the availability of sorghum in domestic markets for feeding and ethanol production. Because of the greater availability of sorghum, the price fell back below the price of corn and is now more in line with historic relationships. Given these lower prices, sorghum use for ethanol production is expected to expand more than fivefold this year, and U.S. shipments to Mexico, which were hampered by the high prices for the 2014 crop, are expected to at least partially resume during the current marketing year, which began in September 2015. This chart is based on the October 2015 Feed Outlook and the ERS Feed Grains database.
Thursday, November 5, 2015
U.S. exports of distillers dried grains with solubles (DDGS)—a common byproduct of corn ethanol production—have grown from nearly zero in 2005 to as high as 12 million metric tons in the 2013/14 marketing year (September/August), with 10 million metric tons forecast for export in the 2015 marketing year. This increase in exports reflects the expansion in ethanol production that occurred over this same period, rising from just under 4 billion gallons in 2005 to more than 14 billion gallons in 2014. While U.S. corn exports still exceed the volume of DDGS exported, these markets are linked because each ton of corn processed into ethanol produces just under a third of a ton of DDGS. Ethanol production accounted for 38 percent of U.S. corn use in 2014/15, while exports were less than 14 percent, but DDGS exports represent another way that U.S. corn production enters global markets. This chart is from the ERS data products, U.S. Bioenergy Statistics and the Feed Grains Database.
Thursday, October 22, 2015
Brazil had historically been the world’s largest net exporter of ethanol, but rising sugar prices (sugar is Brazil’s primary ethanol feedstock) and growing demand for domestic ethanol consumption led to lower ethanol exports, particularly in 2009 and 2010. In 2010 the Brazilian Government lifted a tariff on ethanol imports through the end of 2015, leading to the country’s first imports of ethanol. Imports grew rapidly in 2011 and resulted in Brazil being a net ethanol importer—by a small margin—for the only time in its history. Ethanol exports recovered in 2012 but have declined each year since, while imports remain an important source of supply. Since 2010, the United States—now the world’s largest ethanol exporter—has been the largest supplier of ethanol to Brazil, followed distantly by the EU. This chart is based on the ERS report, Biofuel Use in International Markets: the Importance of Trade.
Friday, September 25, 2015
Between 2001 and 2014, global biofuel production and use grew rapidly, driven by a combination of rising gasoline prices, falling prices of biofuel inputs, and policies mandating use of renewable fuels. These same factors also led to an expansion of global trade in biofuels. The United States is the world’s largest producer and consumer of ethanol, and prior to 2010 relied partly on imports to meet domestic demand. But beginning in 2010, the United States emerged as a net exporter of ethanol, reflecting the “blend wall” that limits the ethanol content of gasoline used in most conventional vehicles to 10-percent ethanol, while demand for biofuels from other countries, particularly the EU and Brazil, continued to grow. The United States has remained a net exporter of ethanol each year since 2010, and since 2011 has been the world’s largest exporter of ethanol. In 2014, oil prices declined by more than half, pressuring U.S. ethanol consumption; however, the market remained strong due to U.S. government policies mandating ethanol use, the use of ethanol as an octane enhancer, and a large export market. This chart is from Biofuel Use in International Markets: The Importance of Trade, EIB-144, September 2015.