For 2002/03, total feed grain disappearance is down 3 percent from a year earlier, as declines in feed and residual and exports, offset the increase in food, seed, and industrial (FSI) use. FSI use is projected at a record 64 million tons, up 10 percent from 2001/02. By contrast, feed and residual use is down 5 percent and exports are expected to drop 12 percent. Despite the lower total use, feed grain ending stocks are projected to fall more than a third because the 2002 feed grain crop was the smallest since 1995/96.

Feed and residual use of the four feed grains plus wheat in September-August 2002/03 is expected to be down 3 percent from the 162 million tons used in September-August 2001/02. The grain used per grain consuming animal unit (GCAU) in 2002/03 is 1.79 tons, down from 2001/02's 1.81 tons. Corn is expected to represent 92 percent of feed and residual use in 2002/03, unchanged from 2001/02.

Corn production in 2002/03 was 9 billion bushels, down 5 percent from a year earlier. A 6-percent drop in yield accounts for all of the decline because harvested area was up slightly. With beginning stocks down 303 million bushels from the previous year, 2002/03 supply, at 10.6 billion
bushels, is down nearly 800 million from 2001/02 and the lowest since 1997/98. Total domestic use is projected at a record 7,935 million bushels, up slightly from 2001/02. This is the seventh consecutive year domestic use has increased. The year-to-year increase is caused by an increase in FSI
use, which is projected at a record 2,285 million bushels. Feed use (including residual) is projected to be the lowest since 1998/99 and exports the smallest in 5 years. Tighter stocks are leading to higher prices and the 2002/03 season-average price is forecast at $2.25-$2.35 per bushel,
compared with $1.97 the year before.

Corn FSI use in 2002/03 is expected to total 2,285 million bushels, up more than 230 million from 2001/02, and represent 24 percent of total corn use, up 3 percentage points from a year earlier and a record. Corn use in 2002/03 is expected to be up for high fructose corn syrup, starch, alcohol, cereals, and other products, but glucose and dextrose use are projected to be down. Corn used to make ethanol for all of 2002/03 is forecast to be up 30 percent from the 714 million bushels used in 2001/02. Monthly ethanol production (reported in barrels per day) set record-highs from August 2002 to January 2003, but February was down.

Sorghum production dropped almost 30 percent to only 370 million bushels, the smallest crop since 1956. Serious weather problems, which reduced harvested area and lowered yields, are behind the year-to-year drop in production. With higher beginning stocks partially offsetting the smaller crop, total 2002/03 sorghum supplies are down 23 percent. Total use in 2002/03 is forecast down 100 million bushels from a year earlier, with the decline almost equally divided between feed and residual use and exports. Sorghum prices received by farmers are forecast at $2.30-$2.40 per bushel, compared with $1.94 in 2001/02.

Barley production in 2002 was the lowest since 1937, as harvested area declined 4 percent and yields by 6 percent. Total domestic use is forecast down 5 percent from a year earlier due to lower feed and residual use and exports. Barley ending stocks for 2002/03 are forecast at 70 million
bushels, down from 93 million last year. Barley prices received by farmers are forecast at $2.65-$2.75, compared with $2.22 in 2001/02.

Oats supplies in 2002/03 are down only slightly from a year earlier as higher production almost offset the lower beginning stocks. Harvested area was up slightly but yields dropped, leaving production up only 2 percent from a year earlier. Total use of oats in 2002/03 is expected to be
about equal to a year earlier, leaving ending stocks down 8 percent from the 63 million bushels in 2001/02. Prices received by farmers for oats in 2002/03 are expected to average between $1.75-$1.85, compared with $1.59 in 2001/02 and the highest since 1996/97.

According to the March 31 Prospective Plantings report, growers intend to plant 79 million acres of corn in 2003, unchanged from last year’s actual plantings of 79 million. Sorghum growers intend to plant 9.45 million acres of sorghum in 2003, down from 9.58 million acres the previous
year. Barley growers intend to plant 5.38 million barley acres, up 6 percent from a year ago. Farmers indicated they intended to harvest 2.204 million acres of oats for grain in 2003, up 5 percent from 2002.

Hay production in 2002 totaled 151 million tons, down 4 percent from the 2001 total. Acreage harvested, at 64.5 million acres, was up 2 percent from 2001. The average yield, at 2.34 tons per acre, is down 0.13 ton from the previous year. Stocks of all hay on farms on December 1, 2002, were down 6 percent from 2001's 111 million tons. Farmers in March indicated they planned to harvest 63.6 million acres of hay in 2003, down from the 64.5 million acres harvested in 2002.

World coarse grain production is expected to decline more than 3 percent in 2002/03, but corn production is forecast down only 1 percent because the smaller U.S. crop is partly offset by increased foreign production. Foreign harvested area forecasts declined for each of the coarse grains, partly in response to low prices compared with oilseeds and wheat during planting, and partly due to unfavorable weather. Foreign yields increased for corn, boosting production, but production of the other coarse grains declined. Global coarse grains beginning stocks were the lowest since 1995/96. World coarse grain consumption in 2002/03 is expected to decline slightly. However, global consumption is forecast to remain much larger than
production, dropping world ending stocks 28 million tons to 151 million, the smallest since 1983/84.

U.S. corn exports for the October-September 2002/03 trade year are forecast at 43.5 million tons, down 8 percent from the previous year. Increased competition has come from Argentina and China, as well as from large supplies of competitively priced wheat for feeding. Corn exports from Brazil and Eastern Europe, though down compared with the previous year, remain large.

This SUMMARY is published by the Economic Research Service, U.S. Department of Agriculture, Washington, DC 20036-5831.
The complete report will be available electronically in about 1week