Weekly Product Updates

W31: Maize (Corn) Update

Maize (Corn)
South Africa
Published Aug 11, 2023

In W31 in the maize (corn) landscape, the Brazilian domestic market experienced a favorable phase for corn prices. This was driven by global dynamics that improved port prices, robust demand from exporters within Brazil, and strategic decisions by producers amidst the 2023 harvest. However, the tendency to withhold corn stocks while maintaining soybeans and sorghum sales could lead to challenges. This may include missing out on favorable export opportunities and creating logistical issues for the 2024 harvest. While the corn harvest size of the United States (US) and the Black Sea tensions have influenced this cautious approach, recent developments such as rain relief in the US Midwest and stabilizing Ukrainian conditions have tempered the market's previous upward momentum. The belief that holding corn for a higher price during the peak of the US crop season might not yield optimal results is gaining traction. This is especially as Chicago Board of Trade (CBOT) prices dropped below USD 5.30/bushel.

The Buenos Aires Grain Exchange reports that the corn harvest in Argentina progressed in W31. This is due to elevated temperatures leading to decreased grain moisture, although some fields still exhibited moisture levels above the ideal range. The corn harvest reached 72.6% of the total estimated maize for the 2022/23 season, with an average yield of approximately 4,990 kilogram (kg)/hectare (ha). The Buenos Aires Grain Exchange maintained an Argentine corn production projection of 34 million metric tons (mmt), noting the impact of a historic drought in 2022/23, resulting in an 18 mmt reduction compared to 2021/22. However, concerns are growing about the 2023/24 season due to uncertainties arising from weather conditions.

Argentine corn harvesting progressed well for the late and second-rate crops, particularly in the South Core, with 85% harvested and an average yield of 4,920kg/ha. In the North Nucleus, 62% of late corn was harvested with an average yield of 4,910kg/ha, though some areas still had grain moisture levels of 20% to 22%, hampering harvesting. In the western regions, harvesting advanced well, with the Center-North of Córdoba registering average yields of 4,720kg/ha for late corn. The southern part of the province achieved an average yield of 5,450kg/ha. In the north, the NorOeste Argentino (NOA) and the Argentine North-East (NEA) regions saw a week-on-week (WoW) progress of 12% and 14 %, respectively. The corn yield varied, where NOA was more affected, reporting a yield of 5,100kg/ha, 600kg/ha lower than in NEA. The NEA reported above-average yields in specific areas like the southwest of Chaco and the center-east of Santiago del Estero.

Lastly, the South African white maize supply in the 2023/24 season is pegged at 9.58 mmt. This consists of an opening stock of 1.08 mmt on May 1, 2023, and domestic commercial deliveries totaling 8.43 mmt. Whole white maize imports are anticipated to be negligible at 0 mt, while early deliveries are estimated at 55.8 thousand metric tons (mt). Whole white maize surplus is expected to reach 15 thousand mt. South African total white maize demand is forecasted at 7.94 mmt in 2023/24. Within this, the domestic demand is projected at 6.88 mmt, comprising 4.94 mmt for human consumption, 1.9 mmt for animal and industrial use, 11.2 thousand mt for gristing, 14.5 thousand mt withdrawn by producers, 5.5 thousand mt released to end-consumers, and a balancing volume of 5 thousand mt. Additionally, South African maize exports are estimated to include 165 thousand mt of processed products and 900 thousand mt of white whole maize for the 2023/24 season.

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