World Corn Report
Global corn production is forecast lower with smaller crops in the European Union, South Africa, the Philippines, and Nigeria offsetting larger crops in the United States, Angola, Mali, Pakistan, and Turkey.
World Corn Report
OVERVIEW FOR 2022/23
Global corn production is forecast lower with smaller crops in the European Union, South Africa, the Philippines, and Nigeria offsetting larger crops in the United States, Angola, Mali, Pakistan, and Turkey. Global trade is forecast down this month on lower exports from Argentina and South Africa. Global imports are also forecast down this month on cuts to Vietnam, Algeria, and Turkey. The U.S. season-average farm price is unchanged at $6.80 per bushel.
CORN PRICES
Since the October WASDE, the major exporters’ bids have been overall little changed with the exception of the United States. U.S. bids were up $20/ton to $357. Low water levels in the Mississippi River have continued to negatively impact grain deliveries, though outstanding sales for the current marketing year are also weak. Brazilian bids were up $6/ton to $300. Brazil exported another near-record volume of 7.2 million tons in October. Both Argentine and Ukrainian bids were overall little changed, with Argentina up $3/ton to $307 and Ukraine down $2/ton to $265. The abrupt withdrawal and return of Russia to the Black Sea Grain Initiative injected further uncertainty about the continuation of the agreement past its current expiry of November 19.
MARKET FEATURE
Record EU Imports of Brazil Corn in Q4 (Jul-Sep)
The European Union imported a record 4.2 million tons of corn from Brazil during the fourth quarter (Q4) of 2021/22, which runs July 2022 to September 2022. Due to prevalent drought damage, EU corn production for 2022/23 is forecast at the lowest since 2007/08 and 20 percent below last year. In anticipation of lower domestic supplies, demand for imported corn spiked during the latter half of 2021/22 and continues to be strong. Despite the ongoing conflict with Russia and uncertainty over the Black Sea grain corridor agreement, the EU continues to import corn from Ukraine, its largest supplier, with nearly 10 million tons in 2021/22.
Total forecast consumption for EU corn is down 10 percent year over year. Even considering this reduction, the magnitude of the 23 percent loss in production year over year has left a sizeable void to be filled. Brazil has been the top exporter of corn in Q4 to the European Union since 2016/17, and with lower anticipated exports from traditional partners such as Serbia and Canada and favorable domestic production, Brazil is well positioned to continue, or possibly increase, exports to the European Union.
On average during the past 5 marketing years (Oct–Sep), roughly 60 percent of EU corn imports from Brazil occur within the July-September period. Brazil’s second corn crop, the safrinha, accounts for more than 75 percent of Brazil’s annual production and is typically harvested between May and August, providing ample supplies during the EU summer months.
EuroStat trade data (Oct 2021 – Aug 2022) reports imports of Brazil corn at roughly 3.8 million tons. EU customs surveillance data show corn imports from Brazil for September 2022 at approximately 1.6 million tons, bringing the total volume for 2021/22 to around 5.4 million tons. According to EU customs surveillance, the pace of corn imports from Brazil remains strong in October.