Canada Markets

On Nov. 14, USDA surprised the market when it left the national corn yield at 186 bushels per acre (bpa) when many questioned the ability of the crop to top last year's record yield of 179.3 bpa for the final estimate in January (even though the average pre-report estimate was 183.5 bpa for the November report). The result was a quick decline of $0.225/bushel during the following 10 days, keeping U.S. corn on sale for world importing countries. And all indications suggest that the record interest in U.S. corn has not abated to date. But now what happens if China surprisingly joins in on the action?

As you can see by the accompanying chart, total U.S. corn export commitments (outstanding sales plus accumulated exports) to the week ending Oct. 9 were setting a record pace. This far exceeded the 2021-22 pace that included China's purchases during the Trump first-term U.S-China Phase One trade deal. Commitments were already at 1.210 billion bushels (bb) compared to just 782 million bushels (mb) last year (that eventually set an annual record for corn exports). And that was without any sales to China.

In the meantime, we have had weekly export inspection data to work with during the government shutdown -- and they have been on fire for corn. Export inspections as of Nov. 20 already hit 17.482 million metric tons (mmt) compared to 10.164 mmt last year, representing a 72% increase when USDA is only looking for an annual increase of 9%. And that is up from 5% prior to the November World Agricultural Supply and Demand Estimates (WASDE) update due to a 100-mb increase in the export estimate.

But the big question everyone should be asking is: What happens if China returns as a buyer of U.S. corn? Is there justification for a return? Will there be enough to go around, especially if future yield estimates decline as expected? And what are the market implications pricewise?

Since the 2023-24 marketing year, China has resisted importing corn as much as possible, relying on domestic supplies to fill the void caused by annual production deficits. But that can only go on for so long, and based on China's corn market price action, time may be up sooner rather than later.

From 2023-24 to 2025-26, China's corn production only increased from 289 mmt to 295 mmt, up 6 mmt. Yet its total domestic use increased from 307 mmt to 321 mmt, up 14 mmt. With a decrease in imports in 2024-25 (to 1.82 mmt from 23.33 mmt in 2023-24) and another small import total currently expected for 2025-26 of 8 mmt, China's ending stocks have declined sharply. By the end of this marketing year, China is expected to be down to 173.91 mmt from 211.19 mmt in 2023-24, or a whopping 37.28 mmt (17.6%) decline.

That is already starting to show up in China's corn market with prices rallying fairly aggressively off harvest lows put in by early October. With relations improving considerably between Presidents Donald Trump and Xi Jinping, how long might it be until China steps in and buys U.S. corn to go along with the recent soybean and wheat purchases?

As far as global alternatives go, there may not be many, given significant increases in domestic use for biofuel production have more than outpaced increased production in the world major exporting countries. Over that same time span, corn production has increased 14.07 mmt while total domestic use has increased 17.18 mmt, resulting in an actual decrease in exports of 3.18 mmt. And that is assuming major exporting countries' exports can recover from last year's sharp decline (with the help of a crop that's not even planted in many cases yet). Otherwise, the 14.96 mmt decline in corn exports from 2023-24 to 2024-25 may be repeated. In any case, it doesn't leave many alternatives to the U.S. for exportable supplies.

It's also worth considering that China may have pulled back from the export market in 2024-25 due to the sharp decline in exportable supplies in major exporting countries other than the U.S. and rising tensions with the latter. If that was the case and relations are improving as previously mentioned, it certainly supports the theory that China may return sooner rather than later.

Besides the obviously bullish price implications should China re-emerge as a buyer of U.S. corn, it would likely ensure stiff competition for Canada with another year of limited corn imports into Canada expected. Even without that, Agriculture and Agri-Food Canada just lowered its estimate of annual corn imports for 2025-26 by 200,000 metric ton (mt) to 1.9 mmt. That would still be slightly higher than last year's 1.777 mmt but well below the 2023-24 corn import total of 2.979 mmt.

On a closing note, the combined analysis here suggests that domestic feed grain markets in Western Canada should be well supported going forward by limited corn imports and strong export interest in Canadian barley given China's tight corn stocks.

I welcome feedback along with any suggestions for future blogs. My daily comments can be found in Plains, Prairies Opening Comments and Plains, Prairies Quick Takes on DTN products.

Mitch Miller can be reached at mitchmiller.dtn@gmail.com

Follow him on social platform X @mgreymiller

**

Mark your calendars for the next DTN Ag Summit "Planning for Success" on Dec. 3-4 from 9:30 to 11:30 a.m. CST.

Fail to plan, and you're planning to fail. Cyclical challenges in the grain market and shifting power dynamics in the cattle complex highlight necessity of preparedness not only to mitigate risk, but also to maximize opportunities.

In our capstone DTN Ag Summit event, we'll hear directly from young farmers and ranchers about the approaches they're taking to set their businesses up for success and from DTN experts with critical outlooks to help you craft your game plan for 2026.

Featured DTN speakers include Lead Analyst Rhett Montgomery, Ag Meteorologist John Baranick and Livestock Analyst ShayLe Stewart for respective outlooks on the grain market, weather and cattle. Senior Editor Dan Miller welcomes a panel of DTN's America's Best Young Farmers and Ranchers award recipients -- Lucas and Dana Dull, and Lillie and Brian Beringer-Crock -- to discuss new avenues of business and pivots each have made to welcome more agritourism to their operations.

Sign up here: https://www.dtn.com/…

(c) Copyright 2025 DTN, LLC. All rights reserved.