Corn Market Firm Amid Strong Demand, Geopolitical Tensions, and Brazilian Weather Concerns

The recent firm closings in the corn market on Monday highlight the interaction between international price movements, export dynamics, and geopolitical and climatic uncertainties. Both the CBoT and Euronext saw notable price increases.

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Price Developments

• CBoT (March Future): +4.5 ct to 439.75 ct/bu (≈ 173.3 EUR/t)
  • Conversion: 1 bushel of corn equals 25.4 kg.
• Euronext (March Future): +2 EUR to 212.25 EUR/t

Rising wheat and crude oil prices supported these price gains, both of which signalled increased demand and improved market sentiment.

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Export Dynamics

• US Corn Exports (Week ending November 14):
  • Total Exported: 820,608 t (+3% from the previous week, +37% year-over-year)
  • Key Buyers:
    • Mexico: 396,178 t
    • Japan: 129,132 t
  • Year-to-Date Exports: 9.062 million t (+32% compared to last year), marking a six-year high for this period.

The strong export demand reflects global consumption needs and precautionary measures amid geopolitical tensions. Increasing strains in the Pacific region, particularly between the US and China, have prompted countries like Japan to stockpile reserves to safeguard against potential supply disruptions.

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Brazilian Crop Conditions

• Planting Progress (Summer Corn 2024/25):
  • Current Status: 86% of the estimated area planted in Brazil’s central-south region.
  • Comparison: 72% in the previous week; 80% in the same period last year.
• Challenges: Dry conditions in southern Brazil impact crop growth, especially during the critical reproductive phase. Rainfall is urgently needed to secure yield potential.

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Conclusion

The corn market is currently supported by:

1. Strong Export Demand: Significant increases in US shipments, especially to Mexico and Japan.
2. Geopolitical Factors: Heightened tensions drive stockpiling and precautionary purchases, particularly in the Pacific.
3. Weather Conditions in Brazil: Planting is progressing well, but dry weather in key regions poses risks to the crop's development.

In the short term, demand remains robust, while mid-term price stability will likely depend on Brazil's weather conditions and their impact on the harvest.