Indispensable in the daily lives of many people, corn is a source of food and energy.

One of the most widely produced cereals in the world, it is highly nutritious and absolutely necessary for society. With different varieties and applications, its use drives economic development.

The 2023/24 world corn crop is expected to exceed 1.22 billion tons, according to the United States Department of Agriculture (USDA). The United States is the world’s largest producer, with an estimated crop of 386.97 million tons.

By 2023/24, the Brazilian corn crop is expected to reach 146.5 million tons, according to the National Supply Company (Conab). Last year, Brazil was the world’s largest exporter of corn, which considerably boosted the trade balance.

Want to know more about this important product? Read on and check out the exclusive content we have prepared for you.

Corn: where and how did the product originate?

The origin of corn is not completely known. There are indications that it originated in Mexico since it is a species that belongs to the Gramineae/Poaceae family, whose closest relative is Teosinto, a grass native to this region.

The native peoples of Central America were the first to cultivate and perfect corn production. But it was Christopher Columbus who recorded the presence of corn in America in 1492, on the northern coast of Cuba. At that time, corn was already being planted from southern Canada to Chile, except in areas covered by savannahs or with adverse conditions.

Production was then extended to the European market. The Portuguese were mainly responsible for the development of corn in Africa and Asia.

What else do you need to know?

Now that you know a little about the origins of this oilseed, it is time to learn some interesting facts about corn. See below.

1.    Variety of colors and sizes

Corn is not limited to its traditional yellow color. There are varieties of corn, each with its own color, size and flavor. In addition to yellow, it can be found in shades of red, orange, blue, purple and even black.

This diversity of colors and sizes reflects differences in the levels of antioxidants and other nutrients present in the product. Corn varieties are classified into categories such as sweet corn, popcorn, dent corn and flour corn.

Each variety has specific functions in the industry. Sweet corn, for example, is known for its high sugar content and is usually consumed fresh or canned. Popcorn, on the other hand, has a hard husk, so its cultivation involves methods to make it pop when heated.

2.    Raw materials for the industrial sector

Corn is a key product for many industries due to its versatility and nutritional composition. In the food industry, it is needed to produce a wide range of products, such as corn oil, corn flour and corn starch.

In addition to the food industry, corn provides raw materials for the biofuel industry, as it is an important source of ethanol. In the pharmaceutical industry, the raw material is used to produce medicines, vitamins and dietary supplements.

Even in the plastics and packaging industry, cornstarch is used as a raw material to produce bioplastics. It thus offers a more sustainable alternative to traditional plastics.

This variety of applications demonstrates the importance of corn as a valuable raw material in various industries, driving the entire world economy.

More information:

• Ethanol market outlook for Brazil

3.    Use in animal feed

Corn is an essential component in the production of animal feed because of its high energy content and nutritional value. It is, therefore, a source of carbohydrates that provides energy to animals.

Commodity is usually ground to produce meal and mixed with other ingredients to form a balanced diet for livestock. The oilseed is also used to produce silage, which is a fermented feed made from green plants such as corn.

Especially popular for feeding livestock, corn silage provides a nutritious source of feed throughout the year.  It is therefore an economical and effective option for feeding animals in intensive or extensive production systems.

4.    Complex life cycle

There are several factors that influence its growth and development. After all, this crop requires specific climate and soil conditions to thrive.

Therefore, seasonal variations such as temperature, humidity and sunlight play an important role in the success of the crop. In addition, corn is a monoecious plant, with separate male and female flowers on the same plant. In other words, it requires efficient pollination for the formation of corn ears.

Depending on the type of corn and agricultural practices, the growing cycle can vary in length from a few weeks to several months. It comprises several stages, such as germination, vegetative growth, pollination, ear formation and maturation.

Corn is susceptible to a few pests, diseases and adverse environmental conditions such as drought, frost, and strong winds. These aspects affect its productivity.

5.    Good for health

Corn offers some health benefits due to its nutritional composition. It is an excellent source of complex carbohydrates, dietary fiber, vitamins, and minerals.

It stands out for its antioxidant power. That is, its consumption is associated with the prevention of eye diseases such as macular degeneration. It is also a good source of vitamin C, vitamin B and folic acid, important for metabolism and immunity.

The presence of fiber in corn also contributes to good digestion. These benefits highlight the role of corn as a nutritious and beneficial component for the population.

6.    The world’s largest producers

As mentioned above, the United States is the world’s leading producer. The second largest corn producer is China. Brazil is in third place. Argentina is in fourth place. Let’s remember that Brazilian production has a particularity: the possibility of having more than one harvest of the cereal in the same agricultural cycle.

7.    Prices are volatile

Corn market prices are volatile due to supply and demand aspects. Weather phenomena, for example, influence the production of the product. After all, as mentioned above, the crop depends on certain conditions to develop.

Demand for corn also varies in different sectors, such as animal feed, biofuels, the food industry and exports. The volatility of global agricultural commodity prices and the interconnectedness of financial markets can increase price volatility.

This complexity of factors makes corn values susceptible to significant fluctuations. This can have an impact on producers, consumers and the economy in general.

Why manage risk in the corn market?

Risk management in the corn market is critical due to its volatility. Aspects such as adverse weather conditions, economic changes, geopolitical conflicts and government policies have an impact on global supply and demand.

Commodity hedging instruments, such as agricultural derivatives, help protect against losses from sudden changes in corn prices. At Hedgepoint, we offer risk management so that companies can not only protect themselves, but also identify opportunities.

With market intelligence, financial products, continuous training and data analysis, our professionals follow all relevant movements in the industry. In addition, they study in depth how developments can impact the entire commodity chain.

Talk to a Hedgepoint representative and learn more about our risk management tools that can help you.

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