USDA Lowers Global Corn Stock and Production Estimates

The February's corn supply-demand update from the US Department of Agriculture (USDA) showed a notable decrease in global corn stocks. Despite this positive report, Chicago corn futures fell, mainly due to reduced expectations for global imports and exports.

Compared to January 2024 estimates, here's how the global corn balance for 2024/25 has changed:

• Opening stock estimates fell by 1.65 million tonnes to 315.81 million tonnes, down from 304.83 million tonnes in 2023/24. Argentina’s estimate decreased by 1 million tonnes, and Ukraine’s fell by 0.5 million tonnes.
• Global production estimates fell by 1.88 million tonnes to 1,212.47 million tonnes, compared to 1,230 million tonnes in 2023/24. Argentina’s production decreased due to drought, and Brazil’s fell by 1 million tonnes to 126 million tonnes because of heavy rains.
• Consumption figures fell by 0.51 million tonnes to 1,237.96 million tonnes, mainly due to Argentina’s drop of 2 million tonnes. Increased consumption in Ukraine and Southeast Asia somewhat offset this decline.
• Global exports decreased by 2.18 million tonnes to 189.23 million tonnes, driven by a 1-million-tonne decrease in Ukraine’s exports and a 1-million-tonne decrease in Brazil’s exports due to weaker demand from China.
• World corn imports declined by 2 million tonnes, mainly because China’s imports fell by 3 million tonnes to 10 million tonnes. However, Vietnam and Chile slightly increased their imports.
• Final stock estimates decreased by 3.03 million tonnes to 290.31 million tonnes, with China’s stock decreasing by 3 million tonnes to 203.18 million tonnes.

Chicago Corn Prices Drop as Global Trade Conditions Change

Following the USDA's update, March corn futures on the CBOT exchange in Chicago dropped by 1.6% to USD 0,19 per kg. However, compared to post-January levels, prices remained 2.9% higher.

In contrast, corn futures in Paris saw a modest increase of 0.2%, rising to USD 0.23 per kg, marking a 1.9% gain from the previous month.

China’s Lower Corn Imports Add Pressure to Global Markets

China’s significant cut in corn imports is likely to pressurize global prices. Market analysts believe this cut, combined with improved weather in Argentina and Brazil, will influence corn futures in the coming weeks.

Additionally, Ukraine’s export forecast was reduced due to less demand for high-priced Ukrainian corn, further affecting global trade flows.

Conclusion: Global Trade Impacts The Corn Prices

Despite tightening global corn stocks, lower Chinese imports, weaker demand for Ukrainian corn, and better weather conditions in South America are pushing prices down. Going forward, market participants will keep an eye on export trends, weather changes, and the USDA's upcoming updates to understand future price changes.





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