USDA raises global corn production forecast for 2025/26 to record level, 43.7 million tons above current season

In the May supply and demand report, USDA experts raised their forecasts for global corn consumption in 2024/25 MY and 2025/26 MY to record levels, so even the expected increase in global production will not lead to an increase in stocks in the new season.

Corn prices on the Chicago Board of Trade fell slightly yesterday, but overall remain under pressure from news of a reduction in mutual tariffs between the US and China, which could boost US corn exports.

Traders' attention is focused on the first world corn balance from the USDA for the 2025/26 MY, according to which global corn production will increase compared to the current season by 43.7 million tons to a record 1,264.98 million tons, in particular in the USA - by 24.2 million tons to a record 401.85 million tons due to an increase in sowing areas and yields, in Ukraine - by 3.7 to 30.5 million tons, in Argentina - by 3 to 53 million tons, in Brazil - by 1 to 131 million tons.

It is expected that global corn consumption in the 2025/26 MY will increase by 24.4 million tons compared to the current season to 1,274.43 million tons and will exceed production levels for the second year in a row, as a result of which ending stocks in the new season will decrease by 9.45 to 277.84 million tons.

On the CBOT exchange in Chicago, July corn futures fell 0.4% to $176.4/t on the report data yesterday (-7.8% compared to the data after the April report), and December futures rose 0.8% to $175.4/t (-1.9%) on news of improved trade relations between the US and China.

Compared to April estimates , the world corn balance for the 2024/25 MY has undergone the following changes:

• The estimate of opening reserves was increased by 1.74 million tons to 316.07 million tons (304.83 million tons in 2023/24 MY) after adjusting data for Brazil.
• The global production forecast has been increased by 6.18 million tons to 1,221.28 million tons (1,230.5 million tons in 2023/24 MY and 1,160 million tons in 2022/23 MY), in particular for Brazil - by 4 million tons to 130 (119) million tons, while local analysts estimate the harvest at 134-135 million tons.
• The global consumption forecast has been increased by 8.28 million tons to a record 1,250.06 million tons (1,220.13 million tons in 2023/24 MY), in particular for Brazil - by 3 million tons for ethanol consumption.
• The estimate of world exports was increased by 0.67 million tons to 189.35 million tons (193.25 million tons in 2023/24 MY), in particular for the USA - by 1.27 million tons to 66.04 (58.23) million tons, while the estimates for Brazil were reduced by 1 to 43 million tons and Argentina - by 0.5 to 35.5 million tons. For Ukraine, the export forecast was left at 22 million tons, of which 19 million tons have been exported so far.
• The forecast for world ending stocks was reduced by 0.36 million tons to 287.29 million tons (316.07 million tons in 2023/24 MY), while analysts estimated them at 287.07 million tons.

The improvement in the corn balance for the 2024/25 MY is reducing prices for the old corn crop in anticipation of the entry of cheap corn from Brazil and Argentina into the market, so prices in Ukraine will continue to fall over the next month.

Good May rainfall in Ukraine and the EU is improving prospects for the new corn crop, putting pressure on its price.

In the US, 62% of the planned area has already been sown with corn (56% on average over 5 years), and weather conditions are conducive to crop development.