Corn Futures Cheap Enough?
The outlook for a buildup in new crop US corn stocks has pressured corn futures prices all summer. We project the harvest price range for December 2024 corn futures at $3.50 to $4.25 assuming USDA’s August 2024 US new crop corn supply/demand balance forecast.
Factors to consider when forecasting a low in 2024/2025 crop corn futures prices include …
…Possible changes in crop size compared to the August forecast. USDA is already projecting a record national yield for the 2024 US corn crop. In 60% of the years in which the August yield forecast exceeded the previous record final national average corn yield, the monthly projection subsequently declined during harvest.
…Strong export demand. New crop US corn export sales in mid August 2024 were in the 65 percentile of years since 1990. Prospective export demand is supportive, but to generate a major rally, a bullish shocker will be needed as for example significant purchases of US corn by China. So far new crop data does not support China’s need for a substantial increase in corn imports.
| US Corn Supply/Usage Million Bushels & acres | |||||
| 2021/22 | 2022/23 | 2023/24 | 2024/25 | 2025/2024 | |
| 8/12/24 | 8/12/24 | % | |||
| Area Planted | 92.9 | 88.2 | 94.6 | 90.7 | -4% |
| Area Harvested | 85 | 78.7 | 86.5 | 82.7 | -4% |
| Yield per Harv. Ac. | 176.7 | 173.4 | 177.3 | 183.1 | 3% |
| Beginning Stocks | 1,235 | 1,377 | 1,360 | 1,867 | 37% |
| Production | 15,018 | 13,651 | 15,342 | 15,147 | -1% |
| Imports | 24 | 39 | 30 | 25 | -17% |
| Supply, Total | 16,277 | 15,066 | 16,732 | 17,038 | |
| Feed and Residual | 5,671 | 5,485 | 5,775 | 5,825 | 1% |
| Food, Seed & Industrial | 6,757 | 6,558 | 6,840 | 6,840 | 0% |
| Ethanol & by-products | 5,320 | 5,176 | 5,450 | 5,450 | 0% |
| Domestic, Total | 12,427 | 12,044 | 12,615 | 12,665 | 0% |
| Exports | 2,472 | 1,662 | 2,250 | 2,300 | 2% |
| Use, Total | 14,900 | 13,706 | 14,865 | 14,965 | 1% |
| Ending Stocks | 1,377 | 1,360 | 1,867 | 2,073 | 11% |
| Carryout/Usage* | 15% | 17% | 21% | 23% | |
| Farm Price | $6.00 | $6.54 | $4.65 | $4.20 | -10% |
| December Corn Futures Harvest Price Range | |||||
| High | $5.89 | $7.07 | $5.10 | $4.25 | |
| Low | $4.98 | $6.47 | $4.47 | $3.50 | |
| August 2024 USDA data. *Carryout % FSI + Exports | |||||