US corn export inspections up 35%

US corn exports are on a strong run to begin 2025, with futures values spiking accordingly, but how long the bullish pattern will last is an open question, analysts said.

The US Department of Agriculture’s (USDA) latest grain export inspections report, released Feb. 18, recorded weekly shipments of 1,611,469 million tonnes of corn, with 24,727,978 tonnes exported in the market year to date (since Sept. 1), an increase of 35% over 18,262,684 tonnes the prior year to date.

Also on Feb. 18, the Chicago Board of Trade (CBOT) March corn futures contract notched a 16-month high, topping $5.04 per bushel. Adding to bullish sentiments, managed funds generally have assumed a large net long position in CBOT corn since the beginning of the year.

The nearby corn futures contract settled at $4.98 per bushel on Feb. 20, up more than 22% from August 2024 lows near $4 per bushel.

“Corn remains king as prices and price competitiveness have increased over the last several months amid tight global stocks and an impressive export pace led particularly by Mexico,” Tanner Ehmke, a lead economist at CoBank’s Knowledge Exchange division, wrote in a Feb. 20 outlook report.

Pessimistic assessments of South America’s 2024-25 corn crop have helped prop up values. The International Grains Council (IGC) on Feb. 20 cut its forecast for 2024-25 global corn production by 3 million tonnes, to 1.216 billion tonnes, slightly higher than the USDA’s latest projection of 1.212 billion tonnes. The IGC primarily cited worsening crop prospects in South America.

US Corn exports graphic.jpgCredit: ©SOSLAND PUBLISHING CO.
Dry conditions have hampered Argentina’s corn crop, and wet conditions during Brazil’s soybean harvest have delayed the planting of its second “safrinha” corn crop that uses the same fields, pushing corn development into the dry season.

Evolving US trade policy and the specter of a trade war between the United States and its top trading partners — Mexico, Canada and China — have supported frontloading of US corn exports to get ahead of tariffs.

“The strength in corn sales and export inspections this year has certainly been influenced by the election and potential tariffs and retaliatory tariffs, but the main driver has been the limited global (availability) and the United States being priced competitively since July of last year,” said Max Olson, director of financial risk strategy at Global Risk Management. “With corn export sales commitments currently running 28% above the prior year, and export inspections running 35% higher year over year, some demand rationing is needed ahead of the South American harvest.”

In 2021 and 2022, China was the top importer of US corn, followed by Mexico and Japan. But since 2023, US corn exports to Mexico have ballooned. Mexico is now the largest US corn importer, accounting for more than 40% of total US corn exports by value in 2024, according to USDA data.

“For corn, volatile trade relations with neighbors to the north and south creates potential for trade disruptions and tariffs,” Ehmke explained. “A trade dispute with Canada may disrupt exports of US ethanol to the largest export market, accounting for nearly a third of US ethanol exports. A disruption to the important Mexican market could severely impact corn shipments.”

President Donald Trump in early February put on hold his plan for 25% across-the-board tariffs on imports from Mexico and Canada — at least until March, though that deadline is fast approaching. The additional 10% tariff he put in place on Chinese imports also now seems open for renegotiation, after President Trump said Feb. 19 a new trade deal was possible with China. So far, China has responded with retaliatory tariffs that largely excluded agricultural products.

Any change in the US stance toward its top three trading partners may have an outsized impact on corn exports later this year. Together Mexico, Canada and China accounted for nearly half of US corn exports in 2024. As their 2024-25 crops work toward harvest, South American corn-producing nations, particularly Brazil and Argentina, have the most to gain if US exports face tariff headwinds.

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“Going forward, I would expect a sizeable slowdown in export sales as South America takes over the leadership role for corn exports, assuming no further delays in Brazil’s safrinha crop planting and a decent Argentine harvest,” Olson said. “This slowdown into the last half of the US marketing year is typically what we see, but this year we are just starting from an elevated point due to the tight world supplies, concerns earlier in the year around Brazil and Argentina, and the uncertainty around what the US election cycle and tariff potential would bring.”

Alongside South American crop prospects, the potential for more US acreage planted to corn could pressure values in the second half of 2025. Analysts generally expect corn acreage estimates to grow in next month’s USDA Prospective Plantings report. CoBank projects 2025 US corn plantings at 94.55 million acres, up 4.4% from 2024, with corn gaining acreage from soybeans, wheat and cotton.

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