Grains - Grain Products

Corn: IGC forecast with many uncertainties

May 4, 2020 2:53 PM, Der AUDITOR
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PARIS. The corn market continues its weaker trend. France's corn sowing is 70% complete. Since 27 April, the EU has put customs duties of EUR 5.27 per metric tonne tonne on imports of rye, corn and sorghum. The IGC expects a corn crop of 388.8 million metric tonnes in the USA.

In Chicago, corn was quoted at 3.06 USD per bushel at noon, almost unchanged from last Friday. In Paris, the front date fell slightly to EUR 165.00 per metric tonne. However, the cash market in France started with a price markdown of EUR 5.00 per metric tonne compared to last week, which was due to the rapid progress of the corn sowing season of 70%. There is great uncertainty on the US corn market as to how strongly the corona crisis will affect demand for animal feed. The same applies to the demand for corn-based US ethanol. The Kroger supermarkets announced that pork and beef in some markets have already had to be rationed due to low slaughter numbers, because after unsaleable surpluses as recently fresh meat has become scarce in the USA. The export market also came under pressure, US President Donald Trump accused China's government of being responsible for the spread of the coronavirus, raising fears of a resumption of the trade war. US corn sowing is proceeding at an above-average pace, with traders expecting corn production to be 45-48% complete, compared to 39% on a five-year average.

Corn, daily price development

Parity

EUR/mt

Diff. EUR/mt

Bordeaux, FOB

155.00

-5.00

Netherlands, CIF

180.00

-2.00

Oldenburg, DDP

190.00

0.00

Brake, FOT

182.00

0.00

Lower Rhine Region, DDP

182.00

-2.00

Upper Rhine Region, FOB

155.00

-5.00

Trade sources

Brussels levies import duties on maize imports
The focus was on the new forecast of the International Grains Council (IGC). The experts have raised their estimate of the world corn crop 2020/21 only slightly by 1 million metric tonnes to 1.158 billion metric tonnes. The consumption is expected to reach 1.173 billion metric tonnes. However, it remains to be seen how the further demand for ethanol develops. The IGC currently expects global final corn inventories in 2020/21 to reach 281 million metric tonnes, a good 7 million metric tonnes above the March forecast. In the EU-27, the IGC expects a corn crop of 68.2 million metric tonnes. The Ukraine is expected to harvest only 34.5 million metric tonnes due to the drought. In the USA, experts are forecasting a corn crop of 388.8 million metric tonnes, compared with 347.8 million metric tonnes this season. Since 27 April, the EU has levied customs duties of EUR 5.27 per metric tonne on imports of rye, corn and sorghum. In Germany, a survey by the Kleffmann Group showed that corn acreage could increase by 3% to 2,717,945 ha. With an increase of 6.1% or 35,000 ha, Lower Saxony leads the field in this increase. Grain maize production is expected to reach 472,494 ha. This corresponds to an increase of 19% over last year.

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