OVERVIEW FOR 2018/19

Global corn production is up this month with larger crops for Argentina, China, and Ukraine more than offsetting smaller crops for the United States, Mexico, and South Africa. Both Argentina and Ukraine are forecast to have record crops. Global trade is minimally changed as higher imports for Chile and South Africa slightly offset a reduction for Venezuela. For exports, reductions for Argentina, Mexico, and South Africa more than offset gains for Brazil and Ukraine. The U.S. season-average farm price is unchanged at $3.60 per bushel.

CORN PRICES

Global: Corn prices have trended up since the previous WASDE (December). Over the near 2- month period, Argentina bids moved up $9/ton to $176, and Brazil bids were up $7/ton to $185. Black Sea bids have jumped $16/ton to $182 on strong demand from European Union. U.S. bids rose steadily by $4/ton to $174. U.S. prices remain competitive.

Corn Import Demand in South and Southeast Asia Continues to Grow

Robust demand for corn (as both food and feed) has necessitated imports to supplement domestic production in South and Southeast Asia. Growth in feed use, particularly for hog and poultry sectors, has been the major driver, more than doubling corn imports in both regions since 2012/13; this is attributable to corn’s current price competitiveness relative to other feedstuffs such as wheat and barley. In Southeast Asia, Vietnam and Malaysia lead the region in corn imports, driven by strong consumer demand for pork and poultry, respectively. Bangladesh is the leading corn importer in South Asia, following growth in the aquaculture industry.

Among major exporters of corn to South and Southeast Asia, the United States continues to lag behind Brazil and Argentina. Brazil is the primary exporter to Bangladesh, and Argentina is the primary exporter to Vietnam and Malaysia. Traders in these regions prefer South American corn due to market perceptions over kernel hardness, moisture levels, and breakage. However, the competitive pricing of U.S. corn could open opportunities in these price-sensitive markets.