Export prices for corn in Ukraine continue to rise due to increased demand

This week, purchase prices for corn in Ukraine rose by another $3-4/t to $162-166/t or UAH 7,200-7,400/t with delivery to Black Sea ports against the background of active April exports and significant May sales. Traders are raising prices by reducing their margins and reducing freight and port handling costs.

Farmers are busy with sowing, so they hold back sales in anticipation of a rise in prices, but the volume of offers may increase within a week.

In 2023/24 FY, Ukraine exported 22.9 million tons of the USDA's projected 24.5 million tons of corn, in particular in April - 4.14 million tons, while in the previous season these figures were 24.4 million tons and 2.1 million t respectively. Another 2.5-3 million tons of corn may be exported in May, but traders will have to pay a premium to buy these volumes.

A decrease in oil prices by 3.5% in the near future will increase the pressure on the prices of corn and other products used in the production of biodiesel, which, against the background of increased offers from Argentina, will limit the growth of corn prices in Ukraine.

July corn futures on the Chicago Mercantile Exchange fell during the week, but rose 0.9% to $177.5/t yesterday (+2.2% for the month) on the back of higher ethanol production.

In the US, after a 3-week decline, ethanol production rose by 33,000 barrels/day to 987,000 barrels/day during April 20-26. According to Grain Crushings, 11.9 million tons of corn were used for ethanol production in March, which is 7.48% higher than in March 2023 and the largest volume in March since 2018.

According to NASS, 27% of the planned acreage was planted with corn in the US as of April 28 (22% 5-year average), and warm weather with periodic rains will accelerate planting in the near future.

The Buenos Aires Grain Exchange reports that in Argentina on April 24 corn has been threshed on 20% of the area. The number of crops in fair to excellent condition for the week decreased from 64% to 60% (48% last year), but in some regions, especially in the northeast, due to diseases and pests, the yield of corn decreased. Exchange experts left the corn harvest forecast in 2023/24 at the level of 49.5 million tons (36 million tons in 2022/23).