Corn Prices Plunge on Higher Old Crop Stocks and Stalled Black Sea Exports

Corn prices have taken a significant hit this week following the release of the USDA's quarterly stocks report, which showed higher-than-expected old crop stocks. The report indicated that corn stocks as of September 1 stood at 2.1 billion bushels, surpassing the anticipated 1.92 billion bushels and marking a 35% year-on-year increase. This surge in stocks has led to a more comfortable market outlook, making it difficult to justify prices above USD 5 per bushel.

The focus this week is on the October WASDE report, where the USDA will update the carryout number for the old crop based on the latest stocks data. Analysts no longer expect major changes to the September WASDE yield estimate of 178.5 bushels per acre, despite recent rains slowing harvest progress in many regions. However, the higher old crop stocks are expected to support lower new crop price forecasts.

In Chicago, corn prices opened lower last Monday and plummeted on Wednesday after the stocks report was published. Although the market managed to defend the USD 5 per bushel level initially, it ultimately closed the week below this threshold. European corn also saw declines, though they were much smaller compared to the more than 5% drop in Chicago.

Other factors influencing the market include the stalled Black Sea export flows and the weakened Russian export outlook due to ongoing conflicts. The USDA's wheat stocks report was neutral, but the focus remains on the unresolved grain export corridor issues. Weather conditions are also playing a role, with varying impacts on harvest progress and planting activities across different regions.