NEW YORK (Commodity Online): The global Corn (Maize) production may hit a new record of 853 million tons (826 million tons in 2010) in 2011/12 despite the US crop being slightly smaller than last year’s, said International Grains Council (IGC) in a research note.
According to IGC, with harvests in North America and Europe entering their final stages, attention is switching to the southern hemisphere, where farmers in Argentina, Brazil and South Africa are set to plant more Maize than in 2010/11.
Due to strong competition from feed-grade Wheat and projected sluggish growth in industrial demand, world use is forecast to increase at a slower than average pace.
However, with the total still expected to exceed output, 2011/12 ending stocks are forecast to fall to a five-year low. Trade in the year to June 2012 is forecast to increase by 1% due to strong demand from buyers in parts of Latin America, Asia and North Africa.
November Outlook
Reduced grain crop estimates for some major producers, including for maize in the US, are only partly offset by increases in the Commonwealth of Independent States (CIS) and elsewhere, trimming the global production total for 2011/12 by 3 million tons from October, to 1,816 million tons. This would still represent an increase of 64m. tons over last year, largely due to sizeable recoveries in output in Russia, Ukraine and Kazakhstan.
Despite initial support from US cash markets in early November and a smaller official crop estimate, CME Maize futures in Chicago saw major speculative selling, partly due to increased competition from other exporters but with sentiment considerably dented by worries about the global financial crisis and the collapse of a major brokerage firm.
Corn Market Outlook
Chicago Board of Trade (CBOT) Corn for December delivery fell 0.47 percent to $5.86 per bushel by 0401 GMT. Prices were on track for a 3.9 percent weekly drop, their third straight decline.
Traders have been focusing on demand since the U.S. corn and soybean harvests have ended. Markets are waiting to see whether China will ramp up its purchases of corn with prices slipping below $6 per bushel. The last major purchase of U.S. corn by China was when prices fell below the level.
