Corn prices went wild on Thursday as a U.S. Department of Agriculture report shockingly showed that world corn supplies nearly doubled since last month.
The report was not in error, but instead was updating Chinese corn supplies dating back to 2007. China has notoriously been tight-lipped about its commodity inventories, leaving the rest of the world guessing at their stockpiles of corn, cotton, copper, steel, and dozens of other markets.
Without a solid understanding of where Chinese supplies of corn stand, their future demand is harder to guess at, leaving loads of uncertainty surrounding the world’s largest commodity buyer. This is what the Chinese want, since they can use their private information to their advantage in pushing and pulling global prices.
Despite the USDA’s stunning update, the corn market weathered the news relatively well, falling by only a few cents by midday Friday to trade near $3.70 per bushel.