WORLD: Stable US inventories for 2024/2025

From 05/07 to 12/07, the September delivery in Chicago fell by $4/t to $158/t, despite a positive close on Friday following a bullish USDA report for maize. In its July report, compared with June, the USDA revised US maize stocks for the 2024/25 marketing year down very slightly (to 53 Mt), whereas operators had been expecting a substantial rise linked to the increase in production (+5 Mt – 384 Mt), anticipated as a result of the increase in acreage announced at the end of June. These lower USDA stock forecasts come from a surprise drop in stocks for the 2023/24 marketing year (-3.7 Mt – 47.7 Mt) as a result of better-than-expected consumption for animal feed and exports. Despite this, US stocks remain high, and could increase in August with the first estimate of yields by sampling. At this stage, weather conditions are favourable for American maize. On 07/07, 67% of maize was in good to very good condition, up one point on the previous week, and 24% was flowering, compared with an average of 14% at that date. At world level, for the 2024/25 season and compared with June, the USDA has revised production upwards by 4.5 Mt (1125 Mt), maintained its consumption forecast (1222 Mt) and revised stocks upwards by 1 Mt (312 Mt). In Argentina, harvesting is continuing at a brisk pace, with 70% of maize harvested by 10/07, the weather permitting harvesting to meet standards. The USDA has revised production down by 1 Mt (to 52 Mt), but the gap remains wide with local analysts’ estimates (46-47 Mt). In Brazil, the harvest is progressing at a record pace, with 61% of safrinha maize harvested by 07/07. CONAB has revised production upwards by 2mt to 116mt, widening the gap with the USDA (122mt). Given the price ratios, soybean acreage for the coming season could fall for the first time in 17 years, while safrinha maize acreage could fall again in favour of cotton.

EUROPE: Heat continues in the Black Sea

Some rain fell last week in eastern Poland, alleviating some of the water deficit. On the other hand, the Danube basin continues to be dry, with scattered rain expected this week. The very hot, very dry weather is continuing in the Black Sea basin, with temperatures in some places in excess of 35°C at the height of the maize flowering period, with no rain expected. In its July report, compared with June, the USDA confirmed the expected falls in wheat production for 2024/25 in the EU, Russia and Ukraine, but revised US and Chinese stocks upwards. This has eased the wheat balance sheet somewhat, putting pressure on prices. EU maize production has been revised down by 0.8 million tonnes to 64 million tonnes.