Ideal summer growing conditions have helped the U.S. corn crop bounce back from flood damage, according to the latest report from USDA.

The August crop production forecast is now 12.3 billion bushels, nearly five percent higher than predicted last month. It is still down 6 percent from last year’s record, but up 17 percent from 2006.

The big story in the crop report is yields, which are now expected to average 155 bushels per acre, up 3.9 bushels from last year. If realized, this would be the second highest corn yield on record, behind 2004.

Meanwhile, today’s World Supply and Demand Estimates from USDA increases use of corn expected for feed and ethanol. Feed and residual use is raised 100 million bushels with the larger crop and lower expected prices. Ethanol use is raised 150 million bushels as increased supplies and lower prices
are expected to improve plant operating margins and capacity utilization rates. Exports are unchanged as increased competition from wheat feeding limits prospects for U.S. shipments. Ending stocks for U.S. corn are projected at 1.1 billion bushels, up 301 million bushels from last month.