“For the most part, producers should have little difficulty differentiating between new- and old-crop stocks stored on the farm,” Good said. “In some cases, however, commercial facilities storing corn received in late August may not be able to differentiate between old and new crop, but errors should be mostly offsetting. Reporting errors then should be the result of respondents who incorrectly report total inventories rather than old-crop inventories only,” he said.
According to Good, the Sept. 1 estimate of old-crop corn stocks can have important price implications in some years, particularly when stocks are relatively small and the new crop is also expected to be small, like this year. This year, however, the market will have some difficulty interpreting the stocks number as it will reflect both the total magnitude of consumption during the quarter and the degree of substitution of new-crop for old-crop corn in August, without revealing the magnitude of either. Good said, “That mystery will be at least partially solved with the Dec. 1 stocks estimate to be released in January 2013.”