US corn export sales post multiyear highs, even without China -Braun

Reuters

US corn export sales post multiyear highs, even without China -Braun

11:30 sáng giờ GMT, 25 Tháng 10 2024

<html xmlns="http://www.w3.org/1999/xhtml"><head><title>RPT-COLUMN-US corn export sales post multiyear highs, even without China -Braun</title></head><body>

Repeats column first published on Thursday. Karen Braun is a market analyst for Reuters. Views expressed above are her own.

By Karen Braun

NAPERVILLE, Illinois, Oct 24 (Reuters) -U.S. exporters last week sold unusually large volumes of corn that previously were possible only when China was active in the market.

But China was absent this time around, and its import intentions remain unclear for now.

However, the recent flurry of export sales reflect plentiful, cheap U.S. corn supplies that should help the United States easily retain its title as top exporter in 2024-25.

In the week ended Oct. 17, U.S. corn export sales totaled a whopping 4.18 million metric tons (164.7 million bushels), slightly edging all trade estimates. In the last couple of decades, only four other weeks featured larger totals, all in early 2021.

Those four weeks all boasted sales to China well above 3 million tons, though last week’s volume included just 10,000 tons to China, representing a fraction of a cargo. Essentially, China has yet to explicitly participate in the 2024-25 U.S. corn market.

This follows a disappointing trend for U.S. corn exporters, who in 2023-24 shipped just under 3 million tons to China, a four-year low and well off the 2020-21 peak of more than 21 million.

China imported almost 30 million tons of corn that season, though 2024-25 estimates range from 13 million to 19 million tons. Additionally, Brazil started corn trade with China two years ago, substantially cutting U.S. opportunity.

THE UNKNOWN

U.S. corn export sales to unknown destinations have surged in the latest two weeks, causing speculation that China could be buying under the radar. Unknown corn sales reached all-time highs in 2020-21 when China was very active in the U.S. market.

The Chinese buying theory cannot be ruled out, but unknown bookings have been ample in other years where China was not a factor. That includes 2016-17 and 2017-18, both strong years for U.S. corn exports.

Therefore, it is safer to assume for now that the heavy unknown sales are simply signaling a bountiful season ahead, potentially including more-than-normal interest from non-traditional players.

The unknown figures should be closely watched, though, as they have grown unusually large relative to total commitments. Unknown destinations accounted for 21% of all 2024-25 U.S. corn bookings as of Oct. 17, the highest share in eight years.

NOT JUST MEXICO

Last week’s corn sales relied heavily on a single 1.6 million-ton allocation to Mexico, split between 2024-25 and 2025-26. However, a comparably large sale to Mexico is typically observed every year around this time, so the Mexican sale does not fully explain the weekly anomaly.

Mexico has about 10 million tons of U.S. corn booked for 2024-25, easily a record for the date. But it is important for the health of the U.S. export program that not everything hinges on its top corn customer.

Nothing looks out of place yet. Mexico accounts for 42% of total 2024-25 corn sales so far, below the year-ago 52% and below the same points in 2017 and 2019.

Key buyer Japan’s U.S. corn bookings are at four-year highs, and the U.S. Department of Agriculture on Thursday announced the first daily sale of U.S. corn to Japan since February, totaling 227,600 tons.

ON PACE

As of Oct. 17, U.S. corn export sales covered 40% of USDA’s full-year forecast for 2024-25, a three-year high for the date and above the year-ago 33%.

That compares with an Oct. 17 average of 31% between 2015 and 2019, years in which both corn prices were relatively low and China was not in the picture.

U.S. corn export demand looks promising as prices are globally competitive and No. 2 supplier Brazil’s offerings are smaller than last year. Additionally, Ukraine’s 2024-25 exports are pegged at seven-year lows.

However, the central United States desperately needs a break in the recent dry pattern, which has ravaged water levels in the Mississippi River and slowed barge movements to the Gulf.

Exports could be threatened if the problem persists. Forecasts suggest partial relief is in store next week, but longer-term outlooks indicate November may feature below-average precipitation.

Karen Braun is a market analyst for Reuters. Views expressed above are her own.

Graphic- U.S. corn weekly net export sales https://tmsnrt.rs/4e0imty

Graphic- Accumulated U.S. net corn export sales to unknown destinations https://tmsnrt.rs/3YzqTPV

Writing by Karen Braun
Editing by Matthew Lewis

</body></html>