US corn demand is up in the 2020/21 marketing year from 2019/20 with exports playing a leading role, said Ben Brown, of the Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, in a release on Illinois farmdocdaily.
The USDA increased its 2020/21 US corn export forecast by 75 million bushels in the April World Agricultural Supply/Demand Estimates report after a record-setting month of export inspections in March, Brown said. April export inspections so far support the increase but future revisions will be needed if the shipping pace continues.
Export commitments exceed the season average pace by 485 million bushels, but the gap is decreasing, he said. China is responsible for roughly half of remaining US commitments. Recent sales to Mexico, South Korea and Japan also have been supportive to corn demand amid increasing prices.
Globally available corn supply also is supportive to US corn demand as concern grows for Brazil’s serafina crop and a potential reduction in Argentina’s export volume, Brown said. The USDA may revise US corn exports again in the May WASDE as market fundamentals continue to favor a higher value.
CORN EXPORT SUMMARY
After a relatively slow start compared with recent years, US corn export inspections currently exceed the historical pace needed to hit the USDA’s 2,675-billion-bushel record projection in its April update by 62 million bushels, Brown said. With 18 weeks left in the marketing year, inspections through the week ended April 22 totaled 1.623 billion bushels, roughly 61% the expected annual total.
Export inspections for the same week the previous three years expressed as a share of the corresponding April WASDE forecast in 2018, 2019 and 2020 were 52%, 60% and 51%, respectively, he said. Last week, 76.8 million bushels were inspected for export.
Weekly export inspections in late February, March and early April were very strong historically, Brown said. Three weeks – Feb. 25, March 11 and April 1 – had export inspections of more than 80 million bushels.
As a result, March was expected to have set a monthly export inspection record at roughly 361 million bushels, beating the previous record set in May 2018 of 305 million and the March record of 262 million set in 2017, he said. Weekly export inspections averaged 72 million bushels the previous five weeks with a high and low of 85.1 and 61.4 million bushels, respectively.
To hit USDA’s export target, inspections need to average 58.4 million bushels over the remaining 18 weeks, Brown said.
CATTLE, BEEF RECAP
Fed cattle traded last week at $119 to $124 per cwt on a live basis, down $1 to $2 from the previous week. Dressed-basis trading was at $195 per cwt, down $1 to up $2.
The USDA choice cutout Tuesday was up $5.79 per cwt at $290.99, while select was up $5.18 at $279.53. The choice/select spread widened to $11.46 from $10.85 with 75 loads of fabricated product and 30 loads of trimmings and grinds sold into the spot market.
The USDA reported Tuesday that basis bids for corn from livestock feeding operations in the Southern Plains were unchanged at $1.04 to $1.18 a bushel over the May CBOT futures contract, which settled at $6.95 1/2 a bushel, up $0.15.
There were no delivery intentions posted against the Apr live cattle futures contract Tuesday. None were retendered, and none were demanded or reclaimed.
The CME Feeder Cattle Index for the seven days ended Monday was $135.22 per cwt down $0.28. This compares with Tuesday’s Apr contract settlement of $134.20 per cwt, up $1.45 and May’s $135.87, down $1.40.