Corn futures are trading close to their all-time highs as prospects darken for Brazil’s corn crop, US corn planting gets off to a slow start, and the Russia-Ukraine war rages on.
In the US, cool and wet weather across the Midwest has delayed early corn planting. Gro’s Climate Risk Navigator application, weighted to US corn growing areas, shows the coldest temperatures in at least 20 years. US corn planting is just 4% complete this week, versus a five-year average of 6%.
In Brazil, favorable early conditions for the second corn crop, or safrinha, are giving way to dry weather just ahead of the crop’s critical reproduction and grain-fill growing period, raising the prospect of another La Niña-diminished harvest in June and July. No significant rainfall is forecast for Brazil’s already parched central and southern states for the remainder of the rainy season, which ends in early May.
Mato Grosso state, which produces almost half of Brazil’s safrinha crop, has received below normal precipitation for the past two weeks, and limited rain is in the forecast. Last year, a La Niña-shortened rainy season and an unrelenting drought stressed Brazil’s pollinating corn crop, resulting in a 15% decline in the country’s total corn production.
Argentina’s corn yields are also likely to come in lower than last year, according to Gro’s machine-learning Argentina Corn Yield Forecast Model.
Corn stocks in the US, the largest corn exporter, are the second tightest in eight years. Amid continued uncertainty surrounding exports from Ukraine, the No. 3 corn exporter, and crop prospects in North and South America, Gro predicts an even tighter corn balance sheet for 2022/23.