Corn prices will rise due to increased demand
Now that corn is trading at US $150/t, although prices may soon increase due to drought in the EU and the increasing demand for fodder.
Traders expect in the new report USDA will be reduced forecast for corn production in South America due to drought, however, the U.S. assessment of production will increase, although the increase in the consumption carry-over stocks will be reduced.
According to the exchange of Argentine corn collected from 88,9% of the area, and the average yield of 6.13 t/ha to 8 t/ha on average for 5 years. The gross harvest will reach 31 million tonnes, while in July, the USDA experts estimated at 33 million tons.
the Brazilian Agency Conab has lowered the forecast of maize production in the country by 0.8 MMT to 82.2 million tonnes, while in July the USDA has estimated at 83.5 million tons for the Second corn crop safrinha reduced by 17.8% to 55.3 million tons, and the yield will fall to its lowest in 6 years the level of 4.78 t/ha.
In the US, corn crops are in excellent condition, so traders believe that yields will rise to 176,3 bushel/acre or 110.8 MT/ha, almost will match last year's level. Due to this, the gross harvest will reach 366,2 million tons, against the forecast in July of 361 million tons, which will still yield a crop 2017/18 MG 370,9 million tons.
Continues to grow the demand for corn by exporters and ethanol producers. Weekly exports of corn from the United States amounted to 1.4 million tonnes, which is 46.7 per cent higher than in the corresponding week last year. Ethanol production for the week increased by 5%, which is 8% higher than the same week in 2017.