Сompletion of planting in the US and the start of the second corn crop in Brazil under favorable conditions are increasing pressure on new crop corn prices

New crop corn futures started the week lower amid fairly positive weather forecasts and conditions for corn planting in South America, the US, and Europe.

A sharp decline in new crop wheat quotes by 1.7-2.8% is also putting pressure on corn prices, with December futures in Chicago falling 1% to $175.6/t yesterday and trading $6/t cheaper than the old crop.

According to the USDA’s weekly report, as of May 25, 87% of the planned area in the US has been sown with corn, which is 2% higher than the 5-year average, seedlings have been obtained on 67% of the area (60% on average), and 68% of the crops are in good or excellent condition.

According to export inspections, during May 15-22, corn exports from the US decreased by 20.7% compared to the previous week to 1.4 million tons, and in total for the season (from September 1) amounted to 46.98 million tons (out of the USDA forecast of 66 million tons), which is 29.2% ahead of last year’s pace.

Brazil has completed the first crop of corn and has started the second crop of safrinha corn, which is currently threshed on 0.9% of the area. Rains have returned to the central regions, improving the condition of the crops and raising harvest forecasts.

Local agency Datagro raised its forecast for Brazil’s total corn harvest in the MY 2024/25 by 1 million tons to 132.7 million tons, exceeding the USDA’s May estimate of 130 million tons.

After prolonged rainfall, dry and warm weather has set in in Argentina for the next 2 weeks. This will accelerate the harvesting of corn, which as of May 20 has been threshed on only 39% of the area with an average yield of 8.07 t/ha. The local grain exchange left the corn production forecast at 49 million t, while the USDA estimated it at 50 million t in May.

Forward prices for new crop corn in Ukraine decreased from $205-208/t to $195-200/t against the backdrop of favorable weather in Ukraine and the EU.

Over the past week, Ukraine has received a monthly rainfall rate, and next week, temperatures are expected to rise and additional precipitation is expected, which will contribute to good germination and a harvest of 30+ million tons.

Tags: corn