As corn prices have declined substantially over the past week and the prospect is for relatively small ending stocks, a University of Illinois agricultural economist believes it is important to continue to monitor the rate of corn consumption to confirm that the necessary rationing is occurring. 

"May and December 2102 futures have declined by $.26 and $.22, respectively, following the release of the USDA's WASDE report on April 10," said Darrel Good.

"Recent weakness in old crop prices started with the USDA's unchanged forecast of year-ending stocks of 801 million bushels. Following the smaller-than-expected estimate of March 1 stocks revealed on March 30, the market had anticipated that the April WASDE report would contain a larger forecast of feed and residual use and a smaller forecast of ending stocks."

Good said additional price weakness has been attributed to weakness in the financial markets associated with a slowdown in the Chinese economy and concerns about the Spanish debt as well as prospects for increased corn acreage in China.

"New crop prices continue to reflect the larger-than-expected planting intentions revealed on March 30, an early start to the planting season, and the recent improvement in soil moisture conditions in a large part of the Corn Belt," Good said.

Good reported that in the Feed Outlook report released on April12, the USDA estimated feed and residual use of corn during the first half of the marketing year at 3.39 billion bushels, 238 million less than during the same period last year. 

The entire decline was in the first quarter of the year. Use in the first half of the year represents 73.7 percent of the projected use of 4.6 billion bushels for the year.