By Joanna Newman
THIS is the time of year when US maize prices are driven by weather conditions in South America as farmers in the southern hemisphere complete their planting.
The recent ample rain has helped Brazilian producers and suggests that Brazil will need to import less maize from Argentina to meet its domestic requirements. This in turn means that Argentina will have more maize on offer into the international market early next year, competing with US exports.
On the positive side, there are reports that Argentina has less acres in maize than last year. There are unofficial estimates of 13.5 million tonnes of which 9.0 million will be exported, compared with 19 million tonnes and 13.5 million of exports in 1997-98.
The latest US Department of Agriculture assessments peg Argentinean maize acreage at a total of 15 million metric tons but this may be revised downwards.
Meanwhile in the northern hemisphere, a cold spell is bringing to an end weeks of unseasonably warm weather. Maize farmers are cheered by the prospect of feeding more grain to livestock in the nations feedlots.
This extra consumption has helped support US prices despite the weather situation in South America. The Chicago March futures contract settled yesterday (17 December) at 220.75¢/bushel, down 2.5¢ from the previous day but little changed from a week ago.