U.S. Corn Market: Any Upside?

Corn seedlings

In today’s tight global corn market, any unplanned event could cause a disruption – resulting in either an upside or downside swing. In this article, our economist Matt Erickson outlines possible upside opportunities. He also offers insights into factors shaping the market in coming months.

Summary Points

  • U.S. corn exports for marketing year 2023/24 are expected to increase but remain below the five-year average.
  • War continues to impact Ukraine’s ability to produce and export corn.
  • Early estimates for the 2023/24 crop put Ukrainian production at the lowest level since 2012/13. If this proves true, countries such as the U.S., Brazil, and Argentina will need to fill the gap on the global market.

Why This Matters

U.S. corn exports of the 2022/23 marketing year (old crop) have dominated discussions to date. For good reason. During the past five years, exports have accounted for 15% of total U.S. corn use, under delivering on expectations and adding to market volatility. Corn exports in marketing year 2022/23 were a full 26% below USDA’s initial projection in the May 2022 WASDE. The WASDE through May 2023 shows significant demand pull back for U.S. corn exports.

With spring 2023 planting nearing completion, the focus is shifting to the new 2023/24 crop and growing conditions. USDA’s May 2023 WASDE gave us a good first look at projections for this year’s corn crop. Frankly, the report met the market’s expectation; supplies are projected to increase on lower use and large new crop stock. As a result, USDA lowered the average farm price for corn from $6.60 per bushel in 2022/23 to $4.80 per bushel in 2023/24. The report set the corn balance sheet up for bearish expectations for marketing year 2023/24.

With these expectations, producers should be in the mindset of monitoring the market for upside opportunities. As attention turns to weather, all eyes will be on the trendline U.S. corn yield of 181.5 bushels per acre. Will weather conditions help deliver solid yields? Obviously, better weather conditions will be needed in the Corn Belt, where dry conditions are forecast to persist through June 8 (Climate Prediction Center - 8 to 14 Day Outlooks (noaa.gov) ). Dry top soil anomalies will be widespread from Kansas and Nebraska, and the central and eastern Corn Belt is forecast to be in flash drought by the end of the week (Climate Prediction Center - (noaa.gov)). But it’s early. The three-month outlook provides a better precipitation forecast (Climate Prediction Center - Seasonal Outlook (noaa.gov) ).  As we’ve seen in most years, weather surprises and shapes the market throughout the summer months.

Tight global markets offer another market upside for producers. Major corn-producing countries experienced significant production declines during marketing year 2022/23. The United States was down 9%; the E.U, 26%; Argentina, 25%; and Ukraine, 36%. The result is low global ending stocks.

Figure 1: Corn world stocks-to-use ratio for 2009/10 to 2023-24F

Figure 1 shows the global stocks-to-use ratio entering 2023/24 at 25.6%. Even if the U.S., Argentina, and Brazil harvest large crops, as currently projected, the stocks-to-use ratio is expected to remain below the 10-year average (red column in Figure 1). 

Sticking to global trends, the overall export picture is clouded by the Russia-Ukraine war. About 85% of global corn exports for the past five years have been supplied by four countries: the U.S., Brazil, Argentina, and Ukraine. Fifteen percent of that was Ukrainian corn.

Production in Ukraine declined 36% from 2021/22 and 2022/23 due to several factors, including the impacts of war and a wetter-than-normal autumn season. Ukrainian production is expected to drop a further 19% this year due from continued impacts of war including a lack of inputs and labor. 

Exports from Ukraine, as Figure 2 shows, is forecast to be down 35% for marketing year 2023/24. If realized, this would be Ukraine’s lowest export level since 2012/13.

Figure 2: World corn exports for Marketing year 2010/11 to 2023/24

The losses from Ukraine will need to be made up elsewhere in the global marketplace, and only a few countries can meet buyer needs to replace the volume from Ukraine. The concentration and competition for bushels from the U.S., Brazil and Argentina could be much greater in 2023/24, with USDA projecting 76% of global corn will be supplied by these three countries, a combined level not seen since 2010/11. A couple factors could determine how much of this volume is captured by the U.S., including the strength of the U.S. dollar and the price of U.S. vs. Brazilian corn. Brazil’s massive grain yields continue to outpace storage capacity, posing a significant challenge to U.S. exports.

In today’s tight global corn market, any unplanned event could disrupt the market. Whether the result would be an upside or downside swing is anyone’s guess. Here are some steps to help producers respond, whatever the market direction:

  • Understand the market event. Here, we have outlined some potential for upside opportunities.
  • Monitor the market swing to take advantage when the time is right.
  • Act by setting price floors that can help protect your margins. Simply put at a time when bearish conditions are expected, the goal is to take advantage of market events in order to “win the margin.”


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