The European market for grain maize is in calm waters, while the price in the US has fallen considerably. Looking at the production figures this fall and the market demand, the market could start to heat up quite a bit in the longer term. For example, South America is heading for a considerably smaller harvest.
Market agency AgRural estimates that Brazil, the largest corn producer, will harvest 20 million tons less corn this season than the previous season. This brings the total volume to 81,9 million tons. Last season, 120,6 million tons of corn were harvested. The 'second crop' after soybeans is very disappointing in the country. Things have been bad since the sowing season and the growing season was also dry. The harvest is almost complete.
In the meantime, the main crop in central Brazil is being sown again under good conditions with sufficient moisture. AgRural expects the area of corn to increase slightly next season.
Changing harvest US
In the US, the corn harvest has yet to start in the corn belt. The area in the Midwest where most grain corn is grown. The yields vary and depend on how much precipitation has fallen this season. It is estimated that the harvest really starts in mid-September. Despite a positive expectation for the total harvest, the stock of corn remains extremely small. The smallest since 2013. Due to the smaller Brazilian harvest, the country is estimated to be able to export a lot of corn again. Processing into ethanol is decreasing. It is currently at its lowest level in 6 months.
All American eyes are on China, the major buyer of corn and beans. The country has already purchased a record amount of corn for the coming harvest season. Nevertheless, market analysts expect that less will be purchased later this season, because the country - unlike last year - now expects an excellent harvest of its own. The USDA's estimated export of 26 million tons will therefore not be achieved. This is what market agency StoneX says. In the current season, China already imported 23 million tons of corn.
Stable European yield
The weather influences that are so clearly reflected in the European wheat market are much less apparent in maize. Yield forecasts remain stable in western Europe, despite wetness and a lack of sun. An advantage is that French corn crops have had sufficient rain this summer.
In the east of Europe it is much drier, which means that the corn is suffering. Romania in particular is an important country. A quarter of all European corn comes from here. Yet the yield remains around average, the EU thinks. Ukraine is heading for a good corn harvest. In Russia it's a different story. Drought there this summer is clearly costing yields.
What are the consequences?
What does this mean for Dutch livestock farmers? If less corn comes from Central and Eastern Europe, more must be imported from France or overseas. This could tip the European corn balance and in any case lead to higher market prices.
In the Netherlands, more grain maize is expected to be harvested this autumn than has been the case in recent years. At that time, many dual-purpose plots were chopped due to a shortage of silage maize. There is much more corn available this season and the price for grain corn is good. This makes it attractive to thresh plots instead of chopping. The cultivation of grain maize in the Netherlands is relatively small, with 11.500 hectares this season. In addition, another 5.800 hectares are being cultivated for CCM. In neighboring country Belgium, for example, grain maize cultivation is much larger at over 43.000 hectares.