Fundamentally Speaking

In last week's WASDE report, USDA kept U.S. 2023/24 corn exports unchanged at 2.100 billion bushels (bb).

This is contrary to expectations that an above average sales pace so far this marketing year may have prompted USDA to increase our overseas sales projections by small amount given the trade estimate for a drop in this year's ending stocks.

Such was not the case as USDA actually boosted ending stocks by 10 million bushels (mb) to a five year high of 2.174 bb as non-ethanol food-seed-industrial (FSI) usage was pared by 10 mb.

This was seen bearishly and added to ongoing losses in corn futures with values now at three-year-plus lows.

Our corn sales have actually held up rather well given a slow start due to very low water levels on the Mississippi River right at the start of this year's shipping period, very expensive shipping costs due to turmoil around the Red Sea area, drought restrictions at the Panama Canal, and little buying by top importer China.

This graphic shows U.S. corn export sales and shipments in million bushels as of the first week of February on the left-hand axis and those figures as a percent of the February WASDE projection on the right-hand axis.

Current sales at 1.374 bb are actually the second lowest of the past five years and at 65.4% of the February WASDE projection are actually below the ten-year average of 67.8%.

Shipments at 671.2 mb are also the second lowest of the past five years and at 32.0% of the 2.10 bb export estimate are also below the ten-year average of 32.3%.

Note that this chart also reports the change in USDA export projection from the February WASDE to the final estimate in mb (figures in gold rectangles).

Last year at this time in the marketing season, both the percent sold and shipped of the February WASDE were much lower, in fact the percent shipped may have been record low and resulted in the USDA lowering final export projection 264 mb from the February 2023 WASDE projection of 1.925 bb.

It's still too early to say whether this year's February WASDE corn export projection will be too light with much depending on how the 2024 South American crop fares.

Even if it is hiked, it will probably be by just a small amount and unlikely to alter the generally bearish outlook for corn over the long-haul.

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