Fundamentally Speaking

Despite a lackluster reaction to this week's unchanged WASDE domestic balance sheet figures, the global corn situation continues to tighten. USDA reported 2024-25 world corn ending stocks at 290.31 million metric tons (mmt), below the average trade guess of 292.52 mmt and the January figure of 293.34 mmt.

In fact, this year's global carryout is down 25.5 mmt from the year-ago figure of 315.81 mmt, which is the largest year-on-year decline since the 1993-94 season.

Looking at these stocks as a percentage of usage reveals one of the tightest world corn stocks-to-use ratios in quite a while. The accompanying chart shows the world, the world-minus-China, major exporters and just the U.S. corn stocks-to-use ratios since the 1990-91 season on the left-axis.

Reported on the right-hand axis is the deflated or inflation-adjusted U.S. average farm price of corn in dollars per bushel. The major exporters are Argentina, Brazil, Russia, South Africa, the United States and Ukraine.

The world corn ending stocks at 290.31 mmt by itself is the lowest since the 2014-15 season, but as a percentage of global use the ratio at 23.6% is the lowest since 2013-14.

China now holds 70% of the world stockpiles and the resultant total without them at 87.1 mmt is the lowest since the 2012-13 season, while the world mius China corn stocks-to-use ratio at 9.5% is the smallest since all the way back to the 1995-96 season.

Major exporter stocks at 47.2 mmt is the lowest since the 2012-13 season as is the stocks-to-use ratio of 10.7%. Meanwhile U.S. ending corn stocks and the stocks-to-use ratio, though down from year-ago levels, still the second highest over the past five seasons as deflated U.S. average farm prices correlate with our stocks-to-use ratio at a 67.7% rate versus 64.5% for major exporter stocks-to-use; 60.5% for world-minus-China stocks-to-use; and finally the 38.4% correlation with the global corn stocks-to-use ratio.

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