- Low international demand for American corn;
- Good expectations for Argentine production;
- USDA figures above expectations for Brazilian production and global stocks.
- Despite registering a more favorable weather pattern, concern about crops in Brazil, especially the 2nd corn crop, persists;
- CONAB reduces the estimate for Brazil's corn crop.
After six consecutive weeks with corn futures ending the period lower, the cereal ended last week near unchanged in Chicago. The March 2024 contract ended last Friday (26) quoted at 445.5 cents/bu, a 0.2% increase compared to the previous week.
Corn-based ethanol production in the US: According to data released by the Energy Information Administration (EIA), US ethanol production totaled 818 thousand barrels per day (tbpd) in the week ended Jan. 19, down 236 tbpd from a week earlier and 196.4 tbpd below the 5-year average for the same period. This significant drop is related to the extreme cold wave that hit the US and negatively impacted the ethanol plants in the country. The stocks ramped up by 120 thousand barrels to 25.8 million.
US export inspections: Corn export inspections did not bring any major surprises to the market at the beginning of last week. According to USDA data, 713.3 TMT of corn were loaded in the week ending January 18, in sympathy with the 728.84 TMT shipped in the same week last year, but below the 946.4 TMT recorded the week before. Thus, total loadings in the US 23/24 crop reached 14.7 million tonnes, 3.2 million behind the registered in the same period of 22/23.
US export sales: The USDA export sales report also did not bring very surprising figures. The Department reported that the US recorded 954.8 TMT of net sales in the week ended on January 18, compared to 1.25 million in the previous week and in line with the 910.4 TMT sold in the equivalent week of 2023. The figure stayed within the market's estimated range of 725 thousand to 1.4 million tonnes. In the accumulated, the 23/24 crop sales totaled 32.8 million tonnes, against 24 million in the same period of 22/23.
US export sales (tmt)
Similar to what was observed in Chicago, corn futures in Brazil also ended the last week nearly unchanged, a behavior that responded to technical factors after the sharp losses accumulated since the beginning of 2024. March 24 ended last Friday at BRL 65.15/bag, a slight decrease of BRL 65.40/bag for the week.
Crop in Argentina: Last week, the Buenos Aires Grain Exchange (BCBA) indicated a slight decrease in crops classified as good/excellent condition, reaching 41%, five p.p. lower than the previous week but 29 p.p. higher than the same period last year. Thus, optimism regarding the supply in the country remains quite high, so much so that the BCBA raised its estimate of the 23/24 corn crop production to 56.5 million tonnes, 1.5 million more than its previous figure and 22.5 million above last year's harvest.
Crop in Brazil: The weekly crop progress report by StoneX indicated that the summer corn harvest reached 11.7% of the total last Friday (26), while 10.8% of the safrinha has already been sown. The focus should now turn to the weather for the second corn crop fields, as the winter cycle is already riskier, as it develops before the dry season, starting in May, in much of Brazil. The forecasts for the next two weeks indicate rain in the entire producing region, emphasizing the second week of the period.
