Thu, May 23, 2024

Corn Planting in the US could be the 2nd-largest in History

Corn prices decline as traders assess Ukraine crisis

The United States Department of Agriculture (USDA) reported the first intentions for planting the new campaign in North America and the quarterly stocks.

The stock data impacts in the short term are optimistic in corn and neutral in soybeans and wheat.

In Chicago, soybeans closed with a rise of US $ 1.33 to the US $ 325. On the other hand, corn prices rose from the US $ 0.24 to the US $ 134, and wheat fell from the US $ 0.82 to US $ 208.Wibest – China: Soybeans being harvested

The US expects producers to implant 39.25 million hectares in the 2020/21 cycle, against 36.30 million last year. This figure rose above the 38.17 million expected by the market and pressures cereal downward in Chicago.

It should be noted that the price of corn has been pressured downward by the collapse of oil. It could impact the planting plans.

Regarding quarterly stocks, USDA data was mostly positive, given that a significant cut is expected. It is due to the agreement the United States made with China, where the Asian giant promised to buy a considerable volume of commodities.

 

Soy is Outperforming Corn

The vision of soy is more bullish than that of corn. 

International soybean prices began to recover due to the reappearance of China. And the uncertainty from the supply side in South America. The recovery of soybeans and the logistical difficulties presented by the coronavirus supports rates at the international level, says FYO market analysis team. 

According to it, stocks in China are at minimal levels. The Chinese economy is reviving, so it could lead to increased corn and grain imports overall. Still, there is concern about the delay in shipments due to logistic problems. 

 

The Decline in Oil Prices Affects the product

The coronavirus continues to spread, and it generates general falls in global markets and significant economic consequences. Besides, falling oil puts pressure on corn in Chicago. Because of its implications for ethanol production, which is a substitute product.

For the 2020/ 21 cycle, record production in the United States is expected, along with growth in the planted area.

However, there’s a doubt in the corn market that the soybean harvest could slow down the corn harvest, further complicating the cereal supply. On the other hand, if the logistics are rearranged, the pressure of the late corn harvest could be felt from June. 

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