US corn harvest surprises and drives down prices.

The harvest of corn The U.S. crop forecast surprised the market after a series of signs of losses caused by heat and drought. According to a report by World Grain, published on October 16, the revision of official estimates changed the perception of American production and caused prices to fall in Chicago.

In its October 9 report, the U.S. Department of Agriculture (USDA) raised its productivity projection from 178.5 to 181.2 bushels per acre, the largest increase between September and October since 2005. Production was estimated at 16.034 billion bushels, a growth of 1.51 TP4T over the previous forecast.

The result contradicted expectations formed throughout the season. In August, after visiting farms in seven states, the Pro Farmer expedition had projected a yield of 173.2 bushels per acre, the lowest since 2020. Concerns about plant development helped push corn futures contracts from US$ 4.02 per bushel at the end of June to US$ 5.18 at the beginning of September.

The change in scenario also reflected larger inventories. On September 1st, the United States had 2.095 billion bushels of corn from the previous crop, a volume 35% higher than that recorded a year earlier. After the release of the October report, the December contract in Chicago fell 4.1%, closing the session at US$ 4.7975 per bushel.

One possible explanation for the revision is that the rains delayed the harvest and allowed the USDA to directly assess more ears of corn still in the field. For Brazil, the evolution of American production deserves attention due to the influence of international prices on the corn market. The next USDA estimate is scheduled for November 10th.