OVERVIEW

Record corn production for 2016/17 is raised from last month with larger crops in both Ukraine and Mexico more than offsetting lower production in the EU. Robust demand in both Iran and Vietnam support a higher volume of global exports. Moreover, a smaller barley crop in Iran boosts the demand for imported feedstuffs. The U.S. season-average farm price for corn is unchanged at $3.40 per bushel.

PRICES

Corn prices in major exporting countries are minimally changed from last month. Argentine quotes are around $182 per ton, mostly unchanged from last month, while Brazilian FOB quotes have been seasonally unavailable. Black Sea quotes are nearly the same at $170. U.S. prices displayed the strongest growth, briefly surpassing $170 but nevertheless retreating to $168 per ton. Reflecting abundant new-crop supplies, both U.S. and Black Sea quotes show significant divergence from South American bids in advance of upcoming harvests. However, Argentine forward prices, March onward, are competitive relative to the United States.

TRADE CHANGES IN 2016/17

Selected Exporters

  • U.S. sorghum is cut 500,000 tons to 5.8 million on a continued slow pace of sales and shipments particularly to China.
  • Canadian corn is up 300,000 tons to 1.0 million reflecting larger sales to Spain.
  • Kazakh barley is boosted 300,000 tons to 1.0 million with the brisk pace of recent exports.
  • Ukrainian corn is raised 700,000 tons to 18.7 million reflecting higher exportable supplies.
  • European Union barley is down 300,000 tons to 5.9 million due to the slow pace of exports.

Selected Importers

  • Chinese sorghum is cut 500,000 tons to 4.5 million on a slower pace to date. Note: 2016/17 (Oct-Sep) corn consumption is boosted this month to partly offset lower imports of alternative feedstuffs, particularly sorghum and distillers’ dried grains (DDGS). Since the elimination of the support price, corn prices in China have dropped substantially, encouraging greater use of domestic corn. Also, higher duties on U.S. DDGS have resulted in substantially lower imports. The corn use for food, seed, industrial (FSI) is also raised as lower prices and government support policies are expected to promote domestic use and exports of corn products - corn starch, glucose, fructose, and citric acid. As a result, corn ending stocks are forecast lower from last month.
  • Iranian corn is boosted 500,000 tons to 7.5 million to partly offset the smaller barley crop.
  • Vietnamese corn is raised 500,000 tons to 8.0 million reflecting larger shipments from Argentina