USDA experts raised the forecast for corn production in MY 2023/24 to a record level

In June’s 2023/24 MY corn supply and demand balance sheet, USDA experts again raised estimates for production, consumption, exports and ending stocks, but quotes barely responded, falling only 0.5-1%.

In the balance for 2022/23 MY, the production forecast for Brazil has been increased by 2 million tons to 132 million tons, which will exceed the analyst estimate of 130.93 million tons and compensate for the decrease in the forecast for Argentina by 2 million tons to 35 million tons. For Ukraine, the production forecast in 2022/23 MR increased by 1.5 million tons to 27 million tons as a result of an increase in the export estimate by 1.5 million tons to 27 million tons (although in fact as of 06.06.23 27.3 million tons have already been exported, and by the end of the season it will be possible ship up to 1 million tons). For the USA, the export forecast was reduced by 1.27 million tons to 43.82 million tons due to increased competition with Brazil, for which the estimate was increased by 2 million tons to 55 million tons, which offsets the decrease in exports from Argentina by 2 million tons to 23 million tons.

In comparison with May estimates , the corn balance for 2023/24 MY underwent the following changes:

• The global production forecast was increased by 3.14 million tons to a record 1,222.77 million tons (1,150.73 million tons in 2022/23 MY, 1,217 million tons in 2021/22 MY, 1,129 million tons in 2020/21 MY), in particular for of Ukraine – by 2.5 to 24.5 million tons (27 million tons in 2022/23 MY), as farmers sowed 4 million hectares with corn (4.6 million hectares last year). For the US, estimates were left unchanged pending the MSG report on sown areas, which will be released on June 30.
• The estimate of world consumption was increased by 2.21 million tons to a record 1206.35 million tons (1163.06 million tons in 2022/23 MY, 1202.9 million tons in 2021/22 MY and 1143.29 million tons in 2020/21 MR ) as a result of increased imports against the background of falling prices.
• The global export forecast was increased by 2.5 million tons to 197.76 million tons (176.37 million tons in 2022/23 MY and 204.7 million tons in 2021/22 MY), in particular for Ukraine – by 2.5 million tons up to 19(17) million tons.
• The forecast of world imports has been increased by 2.5 million tons to 187 (175.03 and 184.59) million tons, in particular for the EU – by 2.5 to 22.5 million tons, since significant volumes of supplies from Ukraine will remain.
• The estimate of world ending stocks was increased by 1.08 to 313.88 million tons (297.41 million tons in 2022/23 MY, 306.9 million tons in 2021/22 MY and 293.29 million tons in 2020/21 MY), which almost corresponds to the analysts’ estimate of 313.12 million tons, so the quotations almost did not react to the data of the report.

On the Chicago Mercantile Exchange, July corn futures fell just 1% to $237.9/t on Friday (+3.1% for the month), while December futures fell 0.5% to $208.8 (+ 4.2% for the month), partially offsetting April’s decline of 11% and 11.4%, respectively.

On the Paris exchange, November corn futures rose 0.6% to €227/t, or $249.7/t, adding 1.7% for the month amid dry weather and deteriorating conditions for corn crops in France.