Corn market outlook in the United States

Introduction: low corn prices in the United States may lead farmers to blame traders, grain companies and the government, but historical facts show that prices depend on supply and demand The above factors do have an impact on supply and demand, but after demand is completed, the price will be directly affected by the size of inventory In 1995 / 96, U.S corn ending inventory decreased to only 18 days of demand, resulting in an average farm corn price of $3.24/bushel US corn exports were strong at 228 million bushels that year as consumers bought corn to store it The high price in that year has led to a sharp decline in export demand in the next few years and a 14% increase in global corn production the following year In 1994 / 95, the share of American corn in Global trade was 76%, and then decreased to 53% in three years In 1998 / 99, the ending stock of American corn was increased to meet the demand of 70 days, in 2000 / 01, the stock was increased to meet the demand of 71 days, and the market share of American corn in other regions with increased production decreased In 2000 / 01, the average price of American farm corn dropped to $1.82/bushel The fall in prices made farmers less interested in producing corn, but stimulated demand In 1997 / 98, the export demand of corn in the United States was 1.541 billion bushels, which is estimated to be 2.05 billion bushels by the end of this market year The low price promotes the increase of demand Export demand will continue to grow in the next few years, and China has become a member of the WTO China will not be able to provide export subsidies at a price higher than $1.0/bushel Argentina is the largest export competitor of corn in the United States, but its farmers are converting the corn planting area to soybean Brazil is similar It is expected that the combined export volume of corn from Argentina, Brazil and China will drop by 350-400 million bushels next year, which will increase the market share of corn in the United States Corn prices in the U.S are at their lowest level in history as traders expect corn acreage to increase next spring The low price of fertilizer and raw materials is expected to increase corn production, and the loan rate of corn and soybean will be readjusted Traders expect corn acreage to increase by two to five million acres But it is expected that the increase in demand will deplete the new production In fact, U.S corn stocks are likely to fall again in 2002 / 03, despite increased acreage US corn will continue to suffer from competition from Argentina and other small-scale producers The increase of feed wheat stock in Europe and the former Soviet Union also made the American corn market competitive But next year, the growth of corn demand in the United States will play a very important role in determining global corn prices.