Bigger US corn stocks fuel doubts about USDA livestock feeding data

• USDA estimated 6.35 billion bushels of corn for feed/residual use in 2025/26, up from 5.44 billion in 2024/25, despite cattle herd at 75-year low making the projection appear inconsistent with market fundamentals
• Analysts expect USDA to raise its September 2026 corn stocks estimate by 7% to 1.67 billion bushels in Friday's report, reflecting the overstatement of feed usage
• The agency faces ongoing scrutiny after making record-large corn acreage revisions last year following staff losses and declining farmer survey response rates

Summary

The US Department of Agriculture (USDA) is expected to lower its estimate of corn fed to livestock in its Friday report after revealing unexpectedly high grain stocks, raising fresh questions about the agency's data reliability.

Key Data Points:

• US corn stocks exceeded 2 billion bushels at the start of September, up 35% year-over-year and 9% above analyst expectations
• USDA previously estimated 6.35 billion bushels of corn for feed/residual use in the 2025/26 crop year, up from 5.44 billion in 2024/25
• Analysts expect USDA to raise its September storage estimate by 7% to 1.67 billion bushels
• US cattle herd sits at a 75-year low

Market Implications:

Analysts believe USDA overstated livestock feed demand by approximately 17% despite a historically small cattle herd. The agency lacks direct feed use measurements and instead estimates this category residually after accounting for exports and ethanol production. The discrepancy suggests more corn remains in storage than previously reported, potentially affecting pricing and supply forecasts.

Credibility Concerns:

This follows recent scrutiny of USDA data quality, including record-large acreage estimate revisions last year amid staff losses and declining farmer survey response rates. The agency has a pattern of surprising analysts with September data—last year's corn stocks came in 15% higher than expected.

Agency Response:

USDA defended its methodology, stating that forecast updates are normal when new information becomes available and emphasizing extensive survey efforts. The agency is seeking to improve data collection processes.

Industry analysts like Jim McCormick of AgMarket.Net and Mike Castle of StoneX have questioned the feed usage figures for months, calling them "insane outliers" given the reduced livestock population.