Corn is rising amid declining US production and inventories, although the global balance is little changed

USDA's October corn balance sheet was little changed from September, but quotes edged higher amid lower estimates of U.S. stocks and production that surprised the market. The supply of corn in the current season is much larger than last year, so prices will not change significantly in the near future.

For the USA, the estimate of initial stocks in FY 2023/24 was reduced by 2.3 to 34.6 million tons, the harvest - by 1.8 to 382.7 million tons, and ending stocks - by 2.8 to 53.6 million tons. although they will still exceed last year's.

Compared to the September estimates , the corn balance for the 2023/24 MR underwent the following changes:

• The estimate of initial reserves was reduced by 1.34 to 298.13 million tons (310.54 million tons in FY 2022/23) as a result of data adjustments for FY 2022/23.
• The global production forecast was increased by 0.18 to 1,214.47 million tons (1,155 million tons in 2022/23 FY, 1,217 million tons in 2021/22 FY and 1,129 million tons in 2020/21 FY), in particular for Argentina - by 1 to 55 (34) million tons and the EU - by 0.3 to 59.7 (52.2) million tons due to improved yields in France, while for the USA the estimate was reduced by 1.8 to 382.7 (348.4) million t.
• The global consumption forecast was increased by 0.43 to 1,200.2 (1,167.41; 1,202.9 and 1,143.29) million tons.
• The estimate of world exports was increased by 0.11 to 196.3 (181) million tons, in particular for Argentina - by 0.5 to 41 (23) million tons, while for the USA it was reduced by 0.6 to 51.4 (42 ,2) million tons.
• The estimate of world imports was reduced by 0.2 to 186.92 (174.18 and 184.59) million tons.
• The forecast of world ending stocks was reduced by 1.6 to 312.4 (298.13; 306.9 and 293.29) million tons, although analysts estimate them at 313.05 million tons.

For Ukraine, USDA experts left the corn harvest forecast in 2023/24 at 28 million tons, and exports at 19.5 million tons, although the estimate of final stocks was increased by 1 to 5.43 million tons due to a decrease in the export forecast for 2022/ 23 MR for 1 to 27 million tons.

According to the report, December corn futures in Chicago rose by 1.6% to $195.3/t (+4.1% for the month, -27% for the year), and November futures in Paris - by 0 .1% to €199.75/t or $210.35/t (-5% for the month, -52% for the year).

For China, the balance was left unchanged, in particular the harvest estimate – at the level of 277 million tons, although the Chinese CASDE increased the production forecast in 2023/24 MR from 284.9 to a record 288.2 million tons, which will exceed last year's figure by 11 million tons. Therefore, in November, we should expect an increase in estimates of the world harvest and stocks of corn.