Market Perspectives – August 5, 2021

Country News

Algeria: Barley production will fall by 600 KMT to a total of 1 MMT, leading to an import requirement of 750 KMT based on domestic consumption of 2.05 MMT. (USDA/FAS)

Argentina: Corn exports are at 16.7 MMT, 15 percent below last year but still 5 percent above the three-year average. The lag is due to a late harvest rather than reduced supply. Also, farmers are hanging on to their crop as an insurance hedge rather than banking pesos. (Reuters; Noticias Financieras)

Brazil: The consultancy Datagro forecasts first crop corn plantings to rise 4 percent and if weather is normal, production will be 28.83 MMT, up 16 percent from the previous season. The larger Safrinha corn crop area is expected to expand 5 percent and yield 90.84 MMT, a 45 percent increase over this year’s drought struck season. AgRural lowered its estimate of the 2021 Safrinha corn crop to 77.5 MMT and pegged exports at 12-14 MMT. That would be a decade low for corn output. Anec says corn exports will be 17 MMT.  DERAL cut the corn estimate for Parana by over a third to 6.11 MMT. IMEA says 84 percent of the corn is harvested and some pasturelands in the northeast part of Mato Grosso could be converted to corn this coming campaign. However, government efforts to boost corn and sorghum output via financing and price guarantees may get beat by the price allure of soybeans. Weather this spring will be a key determinant. If first crop corn production does not rise, more of the 2022 Safrinha corn crop will be needed for domestic consumption instead of export. Farmers are reportedly hoarding supplies and Cargonave says exports are less than half the level of a year ago. Irrespective of high corn prices, Neomille will build a 510-million-liter corn-based ethanol plant. (Reuters; Renewables Now; Hellenic Shipping News; AgriCensus)

EU: Wet weather will affect the quality of late harvested winter crops but summer crops such as French barley are up 12 percent. Barley shipments to China via Rouen have increased. (AgriCensus; MARS)

Paraguay: A truckers’ strike is likely to add to the corn logistical and supply problems for Brazil. (AgriCensus)

Russia: The federal statistics service Rosstat reduced its estimate of the barley planted area, citing increases for oilseeds. Meanwhile, the export tax for corn was reduced slightly but maintained the same level on barley. (AgriCensus)

South Africa: Corn exports have resumed after having been stalled due to riots affecting logistics. (AgriCensus)

Taiwan: MFIG purchased 55 KMT of South African corn. (AgriCensus)

Turkey: Dry weather will cut barley output from the original estimate of 7.7 MMT to about 4.5 MMT for the 2021/22 marketing year. Barley imports will rise to 2.75 MMT. Corn production is forecast at 6.8 MMT, leaving an import requirement of 2.8 MMT. TMO cancelled a 515 KMT barley tender at the 11th hour. (FAS; AgriCensus)

Ukraine: The bid/offer spread on corn is a wide $0.40/bushel as farmers and commercials hold tight on steady sales to China. There are also steady sales of barley to China. (AgriCensus; Reuters)