Corn Export Sales Stronger Than Expected
- Export sales, for the week ended 4/23/20, were 53.4 million bushels, the highest in three weeks, and larger than last year's 23.1 million.
- The largest sales this week went to Mexico with 22.6 million bushels. Japan bought 7.8 million and Korea purchased 7.7 million.
- Corn sales over the last 8 weeks have averaged 49.7 million bushels per week vs last year's 27.2 million per week during the same period.
- Sales need to average nearly 12.5 million bushels per week through the rest of the marketing year to reach USDA’s forecast of 1.725 billion bushels.
FBN’s Take On What It Means: Cumulative sales to date of 1.447 billion bushels are still down 20% from last year's 1.813 billion, but have been gaining consistently. Weekly sales for May through August have averaged approximately 16.4 million bushels per week over the last five years. Given the current pace, it seems unlikely the USDA will change its export projection in the upcoming May Report.
South American Corn Crop Maturing
- In Brazil, EMATER reported Rio Grande do Sul harvest at 85% complete vs 76% average due to dry conditions.
- Key growing regions in Mato Grosso and Parana have received below normal precipitation in April, and the forecast is mostly dry for the first half of May.
- The BAGE reported Argentina’s harvest is 37% finished compared to 29% average.
- Crop conditions were reported 37% good/excellent, improved from 35% last week.
- Steady rainfall across Argentina has been beneficial for later maturing crops, but slowed harvest progress last week.
FBN’s Take On What It Means: The production estimate for Argentina (BAGE 50 million tonnes) will remain unchanged until harvest advances further and more yield data are collected. While there is not currently a major issue, Safrinha (second crop) corn yields in Brazil are closely tied to total precipitation during April/May and the drier forecast will need to be monitored closely in coming weeks. This could be supportive in the near term, but in the longer term, potentially burdensome ending stocks in the US will be the most important influence on prices.
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