International market is under greater pressure with expectations of planting intentions

The US market still has strong weekly exports, maintaining the average of 1 mln tons a week. This maintains the vision, for the old crop, of the possibility of stock cuts due to high exports. For now, USDA has refused to change the projections for another month, that is, it maintained all the projections for this business year in this March report. On the other hand, we have the trade war with Canada, where the major risk for corn is the tax on imports of US ethanol, which would directly affect the corn market. There is also a bias toward planting the US crop, with a recovery of the planted area in the 2025 crop and the prospect of good production again. At the same time, the Argentine harvest is beginning, with export potential of nearly 34 mln tons this year.

The trade war between the United States and the rest of the world continues with new chapters every day. Mexico appears to have understood the coordinates for controlling human and drug trafficking and is giving in to negotiations with the United States, even keeping the imports of transgenic corn open. On the other hand, there was an expectation of greater collaboration from Canada for the necessary adjustments regarding the control of Fentanyl and the flow of irregular goods at the borders. Canada is choosing to retaliate against the tariffs and causing greater political and trade friction at this time. For the corn market, the risk is concentrated in a possible tariff on US ethanol by Canada, a factor that would affect production in the United States and consequently the forecast for corn demand.

However, for now, export figures remain solid in the United States and should only now clash with the supply from Argentina, which will reach the market in April. To date, nearly 51 mln tons are committed to exports, and 40 mln tons have already been shipped. USDA projects sales of 62 mln tons by the end of August, the end of the business year, that is, only 12 mln tons above the sales already made in five and a half months, basically only 2.5 mln tons per month. It seems that USDA will have to increase its annual projection given sales of 4 mln tons per month this year.

On the 31st, USDA will release its planting intention report for the 2025 season. The market bias is consolidated: some increase in the corn acreage and some reduction in soybeans. China retaliated against the United States with tariffs on soybeans at a time when US growers were deciding to plant. This could have a negative impact on the soybean acreage in this 2025 crop. For corn, the same tariffs were imposed, but the United States does not depend on China for corn.

Argentina is starting to reap its crop in the north of the country, with normal productivity. The rain in the core region was intense in the first ten days of March, providing later crops with excellent conditions for pod-filling. It is very difficult to change the corn productivity profile in the final phase, but rain during pod-filling usually contributes to some productivity gains. As for soybeans, the situation is very favorable because it rained in a decisive stage of blossoming and and pod formation.

Now, with the reduction of retentions from 12 to 9.5%, it is believed that local growers will adjust their sales, given that this will allow them to get more pesos and improve their profitability. According to the government, the rule of reducing retentions will only last until June. The current production figure of 49 mln tons is adequate for the reality of 2025.

Tags: corn, soybeans, Canada, US, crop, imports, Market, trade war, China