NAPERVILLE, Illinois, April 11 (Reuters) – The U.S.
Department of Agriculture has held vastly differing views on
Brazil’s corn and soybean production than its Brazilian
counterpart Conab, but now the U.S. agency has taken a mild
approach in reducing Argentina’s corn crop while other industry
estimates are diving.
USDA on Thursday cut Argentina’s 2023-24 corn harvest to 55
million metric tons from 56 million last month. The trade was
expecting 55.6 million, though analysts were polled before this
week’s news that corn has sustained “unprecedented” damage from
the leafhopper-spread spiroplasma disease.
That prompted Argentina’s Rosario exchange on Wednesday to
slash corn production to 50.5 million tons from 57 million
previously forecast. The Buenos Aires exchange followed on
Thursday by reducing corn output to 49.5 million tons from 52
million previously.
Conab on Thursday reduced 2023-24 Brazilian corn production
for a seventh consecutive month to 110.96 million tons from
112.75 in March. However, USDA left its estimate unchanged at
124 million tons. The trade was looking for 121.75 million.
USDA and Conab hold a 13 million-ton difference in Brazil’s
corn output, and now USDA has a 5.5 million-ton corn disparity
versus the lower Argentine exchange outlook.
This puts USDA at most 18.5 million tons (730 million
bushels) higher than other major agencies on combined Argentine
and Brazilian corn output. For context, that volume represents
35% of the total U.S. corn exports predicted for 2023-24.
But USDA and Conab have both made sizable cuts to Brazil’s
corn crop since the initial estimates. USDA’s latest peg is 3.9%
lower than last May’s projection, and Conab’s forecast has come
down 7.1% since October. Those are both the biggest percentage
reductions over the respective time frames in at least a decade.
USDA and Conab’s disparity over Brazil’s 2023-24 soy crop
widened slightly on Thursday with USDA now 5.8% higher than
Conab. Argentine soybeans offer the least disagreement, with
USDA sitting at 50 million tons for the 2023-24 crop and the
Buenos Aires exchange at 51 million.
MORE ON GRAIN TRADE
Thursday offered some mixed news in the corn trade as China
may have canceled up to 300,000 tons of Ukrainian corn for
shipment in April-May, just one day after reports that Ukraine
would ship a combined 1 million tons of corn to China in those
two months.
That would be the biggest April-May volume of Ukrainian corn
to China since 2020, when 1.675 million tons were shipped,
according to LSEG data. It is unclear if the amounts cited on
Wednesday and Thursday overlap, but traders say China’s pullback
in grain consumption is not specific to Ukrainian supply.
China in its monthly supply and demand report on Thursday
upped its 2023-24 corn import forecast to 20 million tons from
17.5 million last month, but suggested those imports may be more
front-loaded in the marketing year.
USDA left Ukrainian corn exports unchanged on Thursday, but
it increased Ukraine’s 2023-24 wheat exports for a sixth
consecutive month, by a total of 59% over that period.
Estimates for Ukraine’s 2023-24 wheat crop rose just 4% in
those six months, and the new export target of 17.5 million
tons, up from 16 million last month, now officially exceeds the
2022-23 total of 17.1 million tons.
Karen Braun is a market analyst for Reuters. Views expressed
above are her own.
(Writing by Karen Braun
Editing by Matthew Lewis)
