U.S. corn export sales hit multi-year highs, even excluding China

Analysts are speculating about the reasons for the sharp increase in the weekly figure

Recently, export sales of corn from the United States have reached record highs. Even excluding China, the volume of exports was very high.

Last week, U.S. exporters delivered a record amount of corn to the world market. Usually such volumes were possible only when China was actively involved in trade. However, this time China did not participate in the trade and its import intentions are still unclear.

Nevertheless, the recent surge in export sales reflects the U.S. corn glut and low corn prices. This should help the United States maintain its status as the top exporter in 2024-2025.

For the week ending October 17, U.S. corn export sales totaled 4.18 million metric tons, slightly above all previous estimates. Only four weeks in the past two decades have had higher numbers, and all of them occurred in early 2021.

All of those four weeks featured sales to China that were well above 3 million metric tons. However, last week’s volume included only 10,000 tons to China, which is only a fraction of the cargo. In fact, China has yet to show a clear interest in the 2024-2025 U.S. corn market.

This is consistent with the downward trend in U.S. corn export volumes, which were just under 3 million tons in 2023-2024, a four-year low and well below the peak of more than 21 million tons in 2020-2021.

China imported nearly 30 million tons of corn last season, although estimates for 2024-2025 range from 13 to 19 million tons. In addition, Brazil began exporting corn to China two years ago, significantly reducing U.S. capacity.

U.S. corn exports to unknown countries have risen sharply over the past two weeks, prompting speculation about possible purchases by China. Sales of unknown corn reached an all-time high in 2020-2021, when China was very active in the U.S. market.

The theory of purchases by China cannot be ruled out, but sales of unknown corn were abundant in other years when China was not a factor. This includes 2016-2017 and 2017-2018, which were strong years for U.S. corn exports.

So at this point, it is more safe to assume that the large sales by unknown players are simply indicative of the upcoming season, which may include more interest from non-traditional players.

However, the unknown numbers should be watched closely as they grew unusually large compared to overall commitments. Unknown destinations accounted for 21% of all U.S. corn orders for 2024-2025 as of Oct. 17, the highest share in eight years.

Corn sales last week relied heavily on a single 1.6 million-ton allocation to Mexico, split between 2024-2025 and 2025-2026. However, relatively large sales to Mexico are typically seen each year at this time, so sales to Mexico do not fully explain the weekly anomaly.

Mexico has reserved about 10 million tons of U.S. corn for 2024-2025, easily a record for that date. But it’s important to the health of the U.S. export program that not everything depends on its main corn buyer.

So far, things are looking good. Mexico accounts for 42% of total corn sales in 2024-2025, down from last year’s 52% and below the same figures in 2017 and 2019.

Reservations of U.S. corn by key buyer, Japan, reached a four-year high, and the U.S. Department of Agriculture on Thursday announced the first daily sale of U.S. corn to Japan since February totaling 227,600 tons.

As of Oct. 17, U.S. corn export sales covered 40 percent of USDA’s annual forecast for 2024-2025, a three-year high as of that date and up from 33 percent last year.

By comparison, the average from 2015 through 2019 was 31%. In those years, corn prices were relatively low and China was not involved in the development.

Demand for U.S. corn exports looks promising as global market prices are competitive and offers from No. 2 supplier Brazil are less than last year. In addition, Ukraine’s exports in 2024-2025 are tied to seven-year lows.

However, the central U.S. is in dire need of a break after the recent drought that has lowered water levels in the Mississippi River and slowed barge traffic in the Gulf.

If the problem persists, exports could be jeopardized. Forecasts suggest partial relief is expected next week, but longer-term projections indicate that November could see below-average rainfall.

For almost 30 years of expertise in the agri markets, UkrAgroConsult has accumulated an extensive database, which became the basis of the platform AgriSupp.

It is a multi-functional online platform with market intelligence for grains and oilseeds that enables to get access to daily operational information on the Black Sea & Danube markets, analytical reports, historical data.

You are welcome to get a 7-day free demo access!!!

Tags: corn, export, USA