USDA experts in a new report raised forecasts for global corn production, consumption and stocks
The new USDA corn balance sheet surprised market participants with a larger-than-expected increase in forecasts for global corn production and stocks, both for the United States and China.
After estimates of global corn production and consumption declined significantly in the August report, in the September balance sheet production forecast corn in my 2021/22 was again increased by 11.65 million tons to 1197.77 million tons (1115.1 million tons in my 2020/21) due to an increase in the forecast for the United States by 6.25 million tons to 380.93 million tons (360.2 million tons in my 2020/21 and 385.2 million tons in the July report) and for China by 5 million tons to 273 million tons (260.7 million tons in 2020/21 MG). In addition, the production forecast was raised for Argentina by 2 million tons to 53 million tons (50 million tons in 2020/21 MG), but lowered for Russia by 1 million tons to 15.5 million tons.
Traders were interested in how much corn sowing areas in the United States will be adjusted, but this time the report data almost coincided with analysts ' estimates – the forecast of areas before harvesting was increased by 0.6 million acres to 85.1 million acres. However, the USDA raised its yield estimate by 1.7 bushels/acre to 176.3 bushels/acre, while analysts estimated it at 175.8 bushels/acre (172 bushels/acre last year), which will lead to a larger-than-expected increase in U.S. corn production.
Rating global consumption corn increased by 4.38 million tons to 1,186.62 million tons, which is 49.9 million tons higher than in 2020/21 MG, due to an increase in the forecast for the United States by 1.91 million tons to 313.07 million tons (309.77 million tons in 2020/21 MG).
Rating world exports corn also increased by 3.42 million tons to 201.27 million tons due to an increase in the forecast for the United States by 1.91 million tons to 62.87 million tons (69.7 million tons in 2020/21 mg) and Argentina by 2 million tons to 3 million tons (37.5 million tons in 2020/21 MG). For Russia, the export forecast was lowered by only 0.2 million tons to 4.8 million tons, although production will decrease by 1 million tons.
Forecast global imports corn was increased by only 1.34 million tons due to increased purchases by Canada amid the drought, while for China, the import estimate was left unchanged at 26 million tons, despite a significant increase in the production forecast.
Due to the decrease in consumption and exports in the previous season, the assessment of initial inventory corn in 2021/22 MG increased by 5.73 million tons to 286.48 million tons, which against the background of increased production will lead to an increase in final inventory by 13 million tons to 297.63 million tons (286.48 million tons in 2020/21 MG), although analysts estimated them at 286 million tons.
The market reaction to the USDA's bearish forecast was, as always, the opposite. December corn futures on Chicago SWOT rose 1.4% to п'ятницю 203.5/ton on Friday, as traders have already taken into account the increase in production in their strategies. And the global balance sheet has returned to the level of analysts ' estimates, slightly higher than the July forecast of the USDA.
