Dry conditions in the US corn belt could leave final output well below previous expectations if sufficient rainfall fails to materialise in the coming weeks, which would in turn constrain the origin's export prospects in 2023-24 and reduce its ability to compete with ample supplies in Brazil in the first part of the marketing year.
For the remainder of 2022-23, US corn exports in May-August could stand at 16.3mn t, assuming the US exports 37pc of its crop in those months, in line with the 10-year average. But China, one of the major recipients of US corn in the past few years, is due to import less corn than previously expected for the rest of 2022-23 and in 2023-24 largely because of increased feed wheat production domestically. Much of the remaining demand is likely to be picked up by Brazil because of the country's record corn crop and competitive prices.
That said, the US may have a short window of opportunity as Brazil struggles with logistics, with corn competing with soybeans and other commodities for internal shipping capacity to ports. The 2022-23 soybean exports are also still ongoing and are for now taking up much of the country's export capacity.
But Brazil's logistical constraints may not be enough to make substantial room for US corn exports to China. In 2022-23, before Brazil's record crop had hit the market, China had already cancelled over 1.5mn t of previously booked volumes, with over half a million tonnes cancelled in the week ending 8 June.
Details: argusmedia.com