USDA is likely underestimating feed demand for corn, Morgan Stanley says. The firm is surprised the USDA kept demand unchanged, given that wheat feed demand was lowered and corn beginning stocks were increased, and demand is likely to increase at current prices.

• See more on Wednesday's USDA numbers
  

"With feeding and ethanol margins still squarely positive at today's prices, we do not currently believe that incentive to ration demand is in place," MS says. Expects feed demand of 4.95B bushels, up from USDA's forecast of 4.7B. Dec corn recently down 7 1/2c to $6.37 1/2.

(ian.berry@dowjones.com)
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(END) Dow Jones Newswires
October 12, 2011 13:25 ET (17:25 GMT)
DJ MARKET TALK: USDA Corn Feed Estimate Too Low At Current Price?->copyright