Corn basis continues to remain strong despite the recent rally in flat-price starting to stall out. The good news is overall demand remains strong. Feed margins are good; U.S. exports are strong and as cheap if not slightly cheaper than Brazil or Ukraine supplies; and U.S. ethanol production continues to push higher.
In fact there is now some talk that the USDA's current 4.9-billion-bushel estimate for corn used for ethanol might soon need to be pushed to 5.0 billion bushels. Not only did production of ethanol increase to new multi-month highs last week, but ethanol supplies are down over 15% from last year. We need everyone involved to push the prices higher and offset the potential near record production looming in the U.S.
Keep in mind, this past weeks ethanol production of 927,000 barrels per day is up some 12.5% from last year. But I think even more impressive is the fact we are closing in on the ALL-TIME record for weekly production set back in the final week of 2011 at 963,000 barrels per day. Keep in mind that was right before the industry was preparing to lose the "VEETC" tax credits.
Corn exports reported at 1.203 million metric tons. The trade was looking for the number to come in between 800,000 and 1.0 million metric tons. Last week sales were reported at 1.718 million metric tons.