Mexico came in with another big buy of U.S. corn. USDA reported a sale of 781,322 metric tons of corn for delivery to Mexico, which is 30.76 million bushels. The confirmation follows a slew of sales to Mexico the past couple of weeks, which is also bringing corn prices back to life.
“If we didn’t have it, corn prices would be a lot lower today than where they are,” said Ben Brown, an agricultural economist with the University of Missouri.
The recent export sale was mainly for the 2024/2025 marketing year, but 65,532 metric tons were tagged for delivery in the 2025/2026 marketing year.
Mexico is already the top buyer of U.S. corn for 2024/2025. So, what’s behind all these big buys? Arlan Suderman of StoneX Group says it’s two-fold: the country needs the grain, and the price is right.
“When we look at the export piece that we’re on right now, it’s stronger than what we normally have at this time of year, and it’s largely been because of Mexico,” said Suderman. “Mexico has been a very aggressive buyer of U.S. corn here, what they perceive to be the harvest lows. That’s not been the trend long-term, but it was the trend last year that followed the drought. They had more drought this last year as well. So, I think because of a tight supply in Mexico, they’re trying to make sure they can get as much coverage as possible near the harvest lows that would suggest weakness down the road.”
Brown agrees that part of the reason Mexico is buying is because of the seasonality of the markets.
“Mexico recognizes that we’re in the middle of harvest. And, in theory, these should be some of our cheapest prices of the year. Mexico does not depend in total on river water levels on the Mississippi to get product. We send a lot of corn to Mexico via rail. We don’t have to worry about that logistics issue to get them product. So, they need corn, and we have corn to sell,” Brown said.
Now the question is: can this strong appetite from Mexico continue? Suderman says part of what may be driving the recent purchases is the fact the Black Sea had a short crop this year, as well as Argentina reducing corn acreage by around 20%.
“They may be saying, ‘you know, the upside risk at these low prices is probably greater than the downside risk. So, now’s the time to go ahead and get coverage,’” Suderman said.
Suderman thinks if the longer-term supply concerns persist, largely with the Black Sea and Argentina, Mexico could continue to make big purchases of corn from the U.S.
“If that continues to be the case, then it has legs. And I do expect to see export demand be stronger than normal in the last half of the marketing year, which, by the way, is when it typically is stronger. So, I think that’s very supportive of strong exports later in the year and USDA needing to raise their export target,” said Suderman.
EDITOR’S TAKE:
This is really good news for corn farmers! Mexico’s huge appetite for U.S. corn is providing some much-needed price support in the corn market. It is especially encouraging as another large crop is looking for a home right now. Although some of the delivery dates are well into the future, it still is good news today. This will also help boost farm income during the current year. That means corn farmers will be looking for those new trucks you have on the lot. Make sure you put that inventory on AGTruckTrader.com® if you haven’t done so already!
