Falling South American corn supply hits global grains outlook

on Jun 4, 2024
  • Argentina's corn production forecast for 2023-24 has been revised downward to 46.5 million metric tons.
  • Brazil's corn output is projected to decrease by 7% in 2023-24.
  • Global corn supply is expected to reach a record high of 1.2 billion mt despite South American supply cuts.

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South American grain supply, particularly corn, remains one of the most volatile in the world, with frequent downward revisions impacting global grain output forecasts.

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For the 2023-2024 marketing year, significant changes in corn production estimates from Argentina and Brazil have shaped the global grains outlook, driving corn prices to three-year lows despite a forecasted record-high global supply.

In Argentina, corn production has been significantly impacted by a series of adverse weather events and diseases.

The initial forecast for Argentina’s corn output in the 2023-24 marketing year was 56.5 million metric tons (mt). However, this figure has been revised downward several times.

By May 2, 2024, the forecast had dropped to 46.5 million mt, marking a 17% decline from the initial estimate. This downward revision was driven by several factors:

Brazil’s corn output projected to decrease by 7% in 2023-24

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Brazil, another major player in the global corn market, has also seen significant revisions in its corn output forecast.

Initially projected at 119.1 million mt for the 2023-24 marketing year, the forecast has been adjusted downward multiple times, ultimately settling at 111.0 million mt by March 2024.

This represents a 7% decline from the initial estimate. The key factors influencing Brazil’s corn production include:

Global implications and price effects

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Despite the significant downward revisions in South American corn production, the global corn supply for the 2023-24 marketing year is still expected to reach a record high of 1.2 billion mt.

This apparent paradox is explained by strong production performances in other regions, which have offset the declines from Argentina and Brazil. Consequently, global corn prices have fallen to their lowest levels in three years.

According to Platts corn prices data, prices have shown a steady decline, driven by the anticipation of abundant global supply despite regional setbacks.

The International Grains Council (IGC) has closely monitored these developments, linking all revisions to its global output forecast to potential supplies from South America.

The council’s output revisions for 2023-24 highlight the influence of South American corn prospects:

Corn Commodity