Corn, popularly known as maize, is one of the staple foods used all over the world with its varieties of uses either for edible purposes or as bio-diesel. The world total output for corn was 1150.6 million metric tons whereas the total supply was 1316 million metric tons in the fiscal year ended 2011/12. The world’s top corn producer is the US producing around 354,346 (‘000 million metric tons) followed by China producing 211,000 (‘000 million metric tons). Brazil and EU stands on the third and fourth position in the production according to the USDA 2013 estimates. The US has been the top consumer too consuming around 279.5 million tons followed by China, European Union and Brazil accordingly consuming 188 million tons, 67.5 million tons and 54 tons respectively. Similarly, according to USDA, the US stands along the top exporter of corn moving down the way to Argentina, Brazil, Ukraine and India.

Corn is also used in the production of ethanol which is used as a biomass as oxygenate in gasoline to produce a low-level blend and E85 flex-fuel vehicles. Partly corn used as sweeteners. The US is expected to reap a record crop production whereas China is expected to decline its harvest as its production is affected by flooding and drought in its provinces. The Heilongjiang province northeastern part of China experienced flooding which curbed the harvest by 5.7% whereas Shandong dropped its output by 22%. Similarly, in Henan province, a severe mid-season drought reduced its crop production by 15%. This will reduce total supply of corn from China whereas the supply from the US will increase. According to SGS SA, the output growth fell by 3.2% in China. The Chinese government had set an annual quota for import of corn of maximum of 7.2 million tons and is expected to touch the limit this year.

The corn futures fell by 39% on Chicago Board of Trade this year; whereas China’s Dalian Commodity Exchange moved back 3.8%. According to the SGS estimates, the Chinese farmers increased the plantation of corn by 0.7% planting around 35.3 million hectares of land by corn compared to 39.4 million hectares in the US. As the corn production by areas though has increased in China, but the production is likely to cut due to floods and droughts. In comparison, due to sound climatic condition in the US the production tends to increase, the shortages of corn from China will raise the corn prices and the US farmers are likely to enjoy the raised prices.