The US Department of Agriculture, which on Tuesday faced fresh doubts over its crop estimates, is to ditch a report that may shed light on a key area of concern – the collapse in US grain use for livestock feed.

The department revealed that it is to axe 10 reports, and reduce the frequency of a further four, to save cash in the face of proposals by US Congress to cut 5% from the domestic National Agricultural Statistics Service division.

The briefings facing elimination include a much-watched July report on US cattle numbers, and a little-known survey on "Distiller Co-Products for Feed" - a topic which USDA officials admitted on Monday, at an annual grilling by investors, could help explain data showing a controversial jump in corn stocks estimates.

The inventory forecasts has crystallised concerns over the USDA's recent record of crop forecasts, which continued on Tuesday with a question over its cotton estimates.

Missing link? 

A 208m-bushel upgrade two weeks to the USDA's estimate of US corn stocks, which sent Chicago futures down the exchange limit, could be down at least in part to distiller's grains, a byproduct of ethanol production, being used in place of the grain, the meeting heard.

"It may be related to the fact that we are using 40% of the [US corn] crop for ethanol," Gerald Bange, head of the USDA's World Agricultural Outlook Board, told traders.

However, the USDA acknowledged a lack of knowledge on the sector, including a lack of "a reliable data source" on conversion rates of corn to ethanol, which would improve insight into distiller's grains output.

A report from Paragon Economics and Steiner Consulting on Tuesday highlighted that output of distillers grains "is an item we do not know for certain at present".

The groups added that they were "not completely sure" what the Distiller Co-Products for Feed survey was, "since we can find nothing about it on the NASS website".

Cotton doubts 

The comments came as Judith Ganes Chase, the veteran soft commodities analyst, added her voice to those raising doubts over USDA estimates, questioning a forecast in last week's Wasde that world use of cotton will increase in 2011-12, despite waning expectations for economic growth.

"The USDA is still pointing to modest growth rather than a cutback. I just don't see how this will happen," Ms Ganes Chase, head of J Ganes Consulting, said.

"Optimistic demand scenarios" for all crops "should be carefully considered and pared back across the board… even in those [markets] that generally tend to be relatively inelastic."