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Corn December 2012 (ZCZ12)

718-6s+6-4 (+0.91%) 7:58P EDT (CBOT)
Commodity Price Quote as of Thursday, May 25th, 6716 View Help

Contract Specifications

Symbol ZC
Name Corn (ZC)
Exchange CBOT
Trading Months March, May, July, September, December (H, K, N, U, Z)
Trading Unit 5,000 bushels
Tick Size 1/4 cent per bushel ($12.50 per contract)
Daily Limit 40 cents per bushel ($2,000 per contract)
Trading Hours 7:00p.m. - 7:45a.m. and 8:30a.m. - 1:15p.m. (Sun-Fri) CST
Last Trading Day The business day prior to the 15th calendar day of the contract month
Value of one futures unit $50
Value of one options unit $50

CRB Yearbook Description

Corn is a member of the grass family of plants and is a native grain of the American continents. Fossils of corn pollen that are over 80,000 years old have been found in lake sediment under Mexico City. Archaeological discoveries show that cultivated corn existed in the southwestern U.S. for at least 3,000 years, indicating that the indigenous people of the region cultivated corn as a food crop long before the Europeans reached the New World. Corn is a hardy plant that grows in many different areas of the world. It can grow at altitudes as low as sea level and as high as 12,000 feet in the South American Andes Mountains. Corn can also grow in tropical climates that receive up to 400 inches of rainfall per year, or in areas that receive only 12 inches of rainfall per year. Corn is used primarily as livestock feed in the United States and the rest of the world. Other uses for corn are alcohol additives for gasoline, adhesives, corn oil for cooking and margarine, sweeteners, and as food for humans. Corn is the largest crop in the U.S., both in terms of the value of the crop and of the acres planted.

The largest futures market for corn is at the Chicago Board of Trade. Corn futures also trade at the Bolsa de Mercadorias & Futuros (BM&F) in Brazil, the Budapest Commodity Exchange, the Marche a Terme International de France (MATIF), the Mercado a Termino de Buenos Aires in Argentina, the Kanmon Commodity Exchange (KCE) in Korea, and the Tokyo Grain Exchange (TGE). The CBOT futures contract calls for the delivery of 5,000 bushels of No. 2 yellow corn at par contract price, No. 1 yellow at 1-1/2 cents per bushel over the contract price, or No. 3 yellow at 1-1/2 cents per bushel below the contract price.

Prices - Corn futures prices in 2011 rallied through the first half of the year and posted an all-time high of $7.9975 a bushel in June 2011. Price rallied as the wet spring prompted the USDA to cut its 2011 U.S. corn production estimate to 13.2 billion bushels from 13.5 billion bushels since flooded fields reduced U.S. planted acres to 90.7 million from 92.2 million acres. U.S. corn supplies also tightened as the USDA in the same month cut its 2011/12 U.S. ending stocks estimate to a 15-year low of 695 million bushels. In addition, the International Grains Council predicted global corn inventories would fall to 111 MMT in 2011/12 or about 13% of consumption, the smallest stocks-to-use ratio since 1974. U.S. corn demand for ethanol continued to expand as U.S. ethanol production rose to a record of 963,000 barrels a day in December 2011. Corn prices remained firm through the summer of 2011 but then sold off to a 1-year low of $5.70 a bushel in December 2011, finishing the year up +2.8% at $6.4650 a bushel. The surge in prices in the first half of the year reduced corn demand from livestock producers who switched to wheat as a cheaper feed alternative to corn. Record high corn prices also dented foreign demand as the USDA in October reduced its 2011 U.S. corn export estimate to a 13-year low of 1.60 billion bushels. Other bearish factors for corn prices during the second half of 2011 included the +9.2% y/y increase in the 2011 China corn harvest to a record 192 MMT, along with the increase in corn plantings for Argentina, the world's second-largest corn exporter, by +7.2% to 12 million acres. Going into 2012, corn supplies remain tight after the USDA cut its 2012 global ending stocks estimate to a 5-year low of 125.35 MMT and with the U.S. stocks/use ratio at a 16-year low of 6.3%. However, the USDA projects 2012 US corn plantings on 94 million acres, the most acres planted since 1944.

Supply - World production of corn in the 2011-12 marketing year rose +4.4% to a new record high of 864.107 million metric tons. The world's largest corn producers are the U.S. with 36.3% of world production, China (22.2%), and Brazil (7.1%). Corn production in both China and Brazil has nearly tripled since 1980. Production in the U.S. over that same time frame has risen by about 50%. The world area harvested with corn in 2011-12 rose +1.6% yr/yr to 314.4 million hectares, just under the 13-year high of 318.7 million hectares in 2007-08. World ending stocks of corn and coarse grains in 2011-12 fell -4.6% to 158.5 million metric tons.

U.S. corn production estimates for the 2011-12 marketing year (Aug-Nov) fell by -0.8% yr/yr to 12.358 billion bushels. U.S. farmers harvested 83.981 million acres of corn for grain usage in 2011-12, which was up +3.1% yr/yr. U.S. corn yield in 2011-12 fell -3.7% to 147.2 bushels per acre. U.S. carry-over stocks on June 1, 2011 fell by -14.9% to 3.669 billion bushels. The largest corn producing states in the U.S. in 2011 were Iowa with 19.1% of U.S. production, Illinois (15.6%), Nebraska (12.4%), Minnesota (9.7%), and Indiana (6.8%). The value of the U.S. corn crop in 2011-12 was $76.464 billion.

Demand - World consumption of corn and rough grains in 2011-12 rose by +2.1% yr/yr to 1,149.9 million metric tons, which was a new record high. The U.S. distribution tables for corn show that in 2011-12 the largest category of usage, aside from animal feed, is for ethanol production (alcohol fuel) with 4.950 billion bushels. That was up +8.36% yr/yr and is 78.0% of total non-feed usage. Corn usage for ethanol is more than seven times the usage in 2000 and that usage category is likely to grow if there is a return of the high prices of crude oil and gasoline. After ethanol, the largest non-feed usage categories are for high fructose corn syrup (HFCS) with 8.4% of U.S. usage, glucose and dextrose sugars (4.1%), corn starch (4.0%), cereal and other corn products (3.1%), and alcoholic beverages (2.1%).

Trade - U.S. exports of corn in 2010-11 (latest data available) fell -9.0% yr/yr to 45.200 million metric tons, which is farther below the record high of 61.417 million metric tons posted in 1979-80. The largest destination countries for U.S. corn exports are Japan, which accounted for 30.7% of U.S. corn exports in 2010-11, South Korea (16.6%), Mexico (13.4%), Egypt (6.5%), Taiwan (6.2%), and Canada (2.1%).

Articles from the Commodity Research Bureau (CRB) Commodity Yearbook. The single most comprehensive source of commodity and futures market information available, the Yearbook is the book of record of the Commodity Research Bureau, which is, in turn, the organization of record for the commodity industry itself. Its sources - reports from governments, private industries, and trade and industrial associations - are authoritative, and its historical scope is second to none. Additional information can be found at www.crbyearbook.com.
More commodity data from Commodity Research Bureau.