What's up (or down) with corn futures?

Here are two headlines from the ethanol and corn press in last three days:
  • USDA Lowers Corn for Ethanol Forecast
  • USDA increases national corn forecast
Confused? While it seems that the USDA is both raising and lowering the same number, that word "ethanol" is key. The lowering of the estimate is for how much corn the ethanol industry will use. Thanks to the ethanol slowdown, the USDA thinks that the ethanol industry will use about 100 million fewer bushels this year than it did a few months ago. Therefore, those 100 million bushels will be available for export (and so corn exports will increase). So, really, the increase and decrease are flip sides of the same coin, a coin that's being minted in the largest corn harvest ever.

[Source: Des Moines Register, Domestic Fuel]

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