Corn Weekly Report

Corn records slight gains in Chicago; Muted WASDE has limited market impact; Brazil completes first shipment of DDG to China

CBOT

Corn futures ended the week slightly higher, with May/26 contracts closing Friday at US¢442.00/bu (+0.7%). In a week marked by a muted WASDE report and few notable headlines, the market continued to lack clear drivers for its dynamics. Nevertheless, several developments deserve attention and may influence the corn market in the coming weeks.

Intraday (15 min) May/26 contract - CBOT

WASDE | The USDA's Supply & Demand report, released last Tuesday (Feb. 10), introduced minimal changes to the global corn balance sheet. A key highlight was another upward revision to US corn exports, now projected at 83.2 million tonnes. While significant, the revision was largely within market expectations, as American exports have consistently shown strong momentum for some time.

The USDA did not provide revisions for Brazil due to the early stages of the second-crop planting season. Notably, the department continues to forecast 136 million tonnes for the 2024/25 crop, despite various sources aligning closer to 140 million tonnes for last year’s crop. It remains to be seen whether these figures will be revised in the future.

Global corn consumption rose slightly from estimates in the January report. In Ukraine, a 200,000-ton increase in domestic consumption was offset by a 1-million-tonne drop in exports, which have faced logistical challenges and harvest delays in recent months.

INDIA | Last week, the United States and India announced a new trade agreement reducing reciprocal tariffs from 25% to 18%, which were imposed by the US in April. Additionally, another 25% tariff related to India’s purchase of Russian oil was eliminated after India committed to scaling back its energy trade with the Eurasian nation.

The agreement was well-received by the market, as the agricultural sector was explicitly mentioned in the official text. Indian tariffs on various US agricultural products are expected to be eliminated, although corn was not specifically referenced in the initial announcement.

USMCA | The US market is keeping a close eye on discussions surrounding the USMCA. Signed in 2018 during President Donald Trump’s first term, the agreement replaced the North American Free Trade Agreement (NAFTA) and established a free-trade zone between the US, Mexico, and Canada, while introducing distinct regulations across specific industries. In recent weeks, following heightened tensions with Canada and Mexico, reports have emerged that President Trump might be considering withdrawing the US from the agreement.

The US is Mexico’s preferred source of corn, with Mexico being the largest importer of American corn. The robust pace of US corn exports owes much to its favorable logistics and zero-tariff access to Mexico.

Therefore, the potential end of the agreement is a critical concern that could disrupt US export flows. However, two considerations should be noted: 1) Even if the USMCA were terminated, US corn would likely remain more competitively priced compared to other sources, although higher costs could pressure margins for consumer sectors in Mexico; 2) The likelihood of the USMCA’s dissolution is low, given that many US industries, such as automotive manufacturing, heavily rely on integrated trade with Canada and Mexico—a factor that would discourage significant changes to the trade dynamic.

Brazil

Corn prices in Brazil declined last week. May/26 contracts on B3 closed the day at BRL 70.61/bag (+2.2%). While a stronger dollar weighed on the domestic market, increased buyer interest was observed throughout last week. Nonetheless, early indications suggest the second-crop planting is progressing relatively well.

Intraday (15 min) May/26 contract - B3

Last week, notable news included the announcement of Brazil’s first-ever official shipment of DDG to China. The shipment comprised 62,000 tonnes of DDG from Inpasa.

Since late 2024, Brazilian and Chinese authorities have been discussing regulatory frameworks to enable DDG exports to China, a key importing market. In May 2025, trade was officially authorized between the two countries, contingent on several phytosanitary certifications, which were finalized in the latter half of last year.

The now-official opening of the Chinese market for Brazilian distillers' grains is a significant milestone for Brazil’s agro-industrial sector. With the rapid expansion of the corn ethanol industry, DDG production is expected to double in the coming years. As such, enabling international trade for this ethanol byproduct is critical to maintaining a balanced domestic market amidst potential oversupply. Meanwhile, domestic DDG consumption continues to rise.

 CBOT futures (US¢/bu)

Source: CME. Design: StoneX.

B3 futures (BRL/bag)

Spot prices in Brazil (BRL/bag)

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