🌽 Corn Market Drops Sharply as U.S.-China Tariff War Escalates 📉

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📊 Market Overview

🔹 CBoT: The May contract fell 13.25 ct to 456.25 ct/bu on Monday as the market reacted to escalating U.S.-China trade tensions and improving crop conditions in South America.🔹 Euronext: The June contract declined 3 EUR to 214.25 EUR/t, pressured by the stronger euro and bearish sentiment from Chicago.

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🌍 Key Market Drivers

📌 1. U.S.-China Trade War Intensifies

• After the market closed on Monday, U.S. President Trump confirmed that higher tariffs on imports from China, Canada, and Mexico would take effect today.
• China responded immediately, announcing:
  • 10–15% tariff increases on various U.S. agricultural and food products.
  • New export and investment restrictions on 25 U.S. companies.
• Market impact: Increased tariffs could significantly reduce U.S. corn exports, further weighing on prices.

📌 2. Improved South American Crop Conditions

• Argentina:
  • Rainfall could reduce feared yield losses and improve crop conditions.
• Brazil:
  • The soybean harvest is now ahead of last year’s pace, allowing a faster transition to second-crop (Safrinha) corn planting.
  • Although the optimal planting window has closed, rapid sowing is still crucial to maximize yield potential before the rainy season ends.
• Market impact: Improved supply prospects pressured prices and prompted fund liquidation.

📌 3. Speculators Unwinding Long Positions

• Hedge funds and traders continue to close out long positions, exacerbating losses.

📌 4. USDA Grain Crushing Report (Ethanol Demand)

• January corn use for ethanol: 457 million bushels, down 4.6% from December, but 3.7% higher YoY.
• Marketing-year total (so far): 2.322 billion bushels, up 2.2% from last year.
• Market impact: Weaker ethanol demand and higher corn stocks contributed to price pressure.

📌 5. U.S. Export Sales & Inspections

• USDA Weekly Export Inspections Report (Feb 27):
  • Total corn shipments: 1.351 million tons.
  • Within market expectations (950,000 – 1.4 million tons).
  • 15.9% higher than last week and 17.9% above the same week last year.
  • YTD U.S. corn exports: 27.257 million tons (+31.7% YoY).

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📉 CBoT Corn Futures (US-Cent/bu)

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📊 Euronext Corn Futures (EUR/t)

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🔮 3-Day Price Forecast

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🌦 14-Day Weather Outlook for Key Growing Regions

🇦🇷 Argentina (Corn Belt)

📍 Current Conditions: Recent rainfall improving crop conditions.📆 Next 14 Days:

• 🌧 More rain expected, but uncertainty remains.
• 🌡 Hot temperatures persist, slowing late-stage crop recovery.

🇧🇷 Brazil (Second Corn Crop Areas)

📍 Current Conditions: Faster soybean harvest improving corn planting prospects.📆 Next 14 Days:

• 🌧 Rainfall could delay remaining corn planting, but crop conditions are favorable overall.

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📉 Global Corn Production & Stocks

📉 Since January 2025, global corn stocks have dropped by 25.5 million tons!

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🌾 Corn Production – 3-Year Comparison

📊 Summary: Brazil is continuing steady growth, while Argentina faces drought-related losses.

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📌 Summary & Market Outlook

📊 Tariff wars and strong South American crops drive corn prices lower.🌎 U.S.-China tensions escalate, threatening corn exports & trade stability.📉 South American weather remains a factor, but rapid Brazilian planting could pressure prices.🔍 Corn futures likely to stay under pressure as trade concerns mount.

📢 Stay tuned for further updates on USDA trade policies & South American crop developments! 🚀