The combination of factors in the second half of 2019 continues to support domestic prices. The first is the flow of shipments, which now reaches 37.3 million tons between February and December, leaving January to close the annual number. Later, delayed rainfall and additional complication for summer corn in the first quarter of 2020, besides the potential delay in the planting of next year’s crop. Solid domestic demand is an important factor, but the consumers’ lack of attention to the corn framework now sustains strong price highs. The picture might be different if there were a defensive position on the part of consumers. The market now has a long supply path until July 2020, when the second season will be harvested and tends to bring domestic supply back to normal.
Many numbers come up in the domestic corn market on several factors, from stocks to exports. In fact, few agents make real and coherent calculations about the actual situation of the national supply and demand, and therefore the divergences eventually arise. The first data on 2019 are the volume of exports. With November expected to close with shipments close to 4.6 million tons and December already having 2 million tons scheduled, the Brazilian cumulative number goes to 37.3 million tons. To reach 40 million tons this year requires an increase in December shipments and at least 2 million tons in January. This is not an impossible flow, but it needs to be confirmed. Depending on what has been actually sold, shipments may even exceed this target.