Fundamentally Speaking

In its last WASDE report, the USDA lowered U.S. corn export volumes by 25 million bushels (mb) this month to 2.45 billion bushels (bb) despite the fact that Sep-Nov export volumes exceeded last year's first-quarter total by 37%.

Looking ahead and considering current outstanding export sales, USDA sees demand for U.S. corn is expected to remain robust despite the higher expected prices and lower supplies that spurred this reduction in the 2024/25 export projection.

The fact is that the U.S. corn export sales pace remains brisk despite the complete absence of China and a good deal of uncertainty about proposed new tariffs being formulated by the Trump administration.

This chart shows the amount of U.S. corn sold, shipped and the shipped/sold ratio as of the fourth week in January as a percent of USDA's January export projection on the left-hand axis.

Reported on the right-hand axis is the percent change in USDA's export projection from the January WASDE report to the final figures for the past 25 years.

Through this week's export sales report, total corn exports are 1.704 bb which is the third highest volume ever as of the fourth week of January, and about 70% of the recent WASDE projection and well above the 25-year average of 61.6%.

Of that total, 824 mb have shipped which is 33.6% of the projected 2.450 bb and the third highest percent in that regard since the 2013/14 season but is actually below the 25-year average of 34.4%.

This results in a shipped-to-sold ratio of 48.4% which is well below the 2000-2025 average of 57.2%.

As noted, with the complete absence of China and Trump's threats to impose tariffs on both Mexico and Columbia, the largest and fourth largest customers of U.S. corn, one may assume that further export projection downgrades could be seen but there are some reasons why this may not be so.

First, the global corn stocks-to-use ratio (less China) is among the lowest in years so overseas corn buyers may not have alternative suppliers.

Second is although a large South American harvest is expected, the final totals may be pared by ongoing dryness in Argentina and less second season corn production out of Brazil that accounts for at least 70% of their total output based on some intended acreage not getting seeded linked to a delayed pace of seedings because of a laggard soybean harvest.

Note that since 2000 there have been six other years when USDA has sold more than 70% of the January WASDE export projection and final exports average 8.5% greater than the January export projection, which in the case of this year would result in a final export figure of 2.655 bb or more than 200 mb ahead of what is currently estimated.

Looking ahead could also see foreign interest in U.S. corn if the end of March 2025 planting intentions report does not post a figure of 93.0 million acres of corn or higher.

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