The CBOT corn futures DEC-23 contract price [Mintec Code: CRNC] settled at USc 449.6/56 bushel, down 4.05% w-o-w on 29th November 2023. Prices were mixed with spot prices down while deferred contracts were slightly up last week. Overall, favourable weather across South America and weak US export demand have pressured corn futures prices.
Beneficial rainfall in Brazil, the second largest global corn producer, weighed on prices this week. An additional 50-75mm of rain is expected across the country over the next two weeks. However, the pressure on the market is likely to be limited, as the current rainfall forecast is estimated at 40-60% of normal and is unlikely to compensate for the country's moisture deficit. Thus, delayed soybean plantings, continue to raise concerns regarding the likely impact on Safrinha corn plantings in Q1 2024. This is anticipated to limit further price declines. According to market sources, the corn planting in Rio Grande do Sul advanced by 1% last week to 82% complete. Farmers are facing difficulties which are attributed to persistent wet conditions. Excessive moisture impedes fieldwork, making it challenging for farmers to complete planting within the desired timeframe.
Argentinian government policies will also be critical market movers, ahead of the inauguration of the president-elect in mid-December. The president-elect, Javier Milei, aims to eradicate the grain export tax, a move welcomed by domestic suppliers, in light of the economic challenges the country faces.