USDA's estimate for corn supplies this marketing year, which was included in last week's WASDE report, reinforces the need for market development, says the National Corn Growers Association (NCGA). USDA expects corn supplies to exceed use by 2.5 billion bushels for the 2005-2006 marketing year.

"The USDA report shows we are still feeling the effects from the record corn crop produced in 2004," said NCGA President Leon Corzine. "There is plenty of corn supply for our traditional markets. The concern we have on the farm and as an organization is market development."

"We are continuing and will continue to produce corn; we must vigorously develop new markets and new uses for corn. That points to the need and importance of NCGA, its member states and the checkoff to create these new markets and new uses."

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USDA projects this year's corn crop at 10.985 billion bushels. That is 7% below last year's record 11.8 billion bushel crop. But, it is nearly 9% higher than the 2003-2004 crop production, which was another record year, according to Max Starbuck, NCGA director of livestock and economic analysis.

"The May report is not based on production surveys but rather on trend estimates," he says. "Weather still remains the key variable when estimating production this early in the growth cycle and that may be forgotten as one focuses in on the numbers."

Starbuck notes that USDA has put 2005-2006 exports at 1.950 billion bushels, which he says seems very aggressive, but increases fuel ethanol production by only 100 million bushels this crop marketing year, which he says seems very weak.

"Ethanol use again leads in projected growth. In fact, corn-based ethanol production is progressing at a rate to surpass an annual production capability of 5 billion gallon in early 2006," Starbuck says.

Corzine says a Renewable Fuels Standard will sustain this domestic success, and trade agreements such as the Central American Dominican Republic Free Trade Agreement (CAFTA-DR) would bolster export markets for corn.

"Corn growers need trade agreements like CAFTA to lock in export markets and regain growth," Corzine said. "They also need the Water Resources Development Act. Without improvements to locks and dams and waterway infrastructures, we lose our ability to stay competitive in export markets."