Corn is rising after oil and against the background of Biden's decision to increase ethanol consumption

The war in Ukraine has significantly affected the prices of oil and motor fuel in all countries. The imposed sanctions limit the revenues of the Russian budget, and the discount on Russian Urals oil has already exceeded $ 35 / barrel.

Oil prices after the fall on Monday resumed growth in the expected new package of sanctions against Russia (caused by the use of chemical weapons in Mariupol), which may impose restrictions on the EU's purchase of Russian oil.

June futures for Brent crude oil at London's ICE Futures rose 6.2% to $ 104.6 / barrel yesterday, and May futures for WTI crude oil on the New York Electronic Commodity Exchange (NYMEX) rose 6.5% % to $ 100.5 / barrel, although on Monday they fell by 4.3% and 4% respectively.

Prices were supported by news of easing quarantine restrictions in Shanghai, China's largest industrial city, which consumes 4% of the country's oil.

The market is worried about the possible failure of oil supplies to the world market, especially after Putin promised to continue the war against Ukraine, and the OPEC Secretary General said that oil production will not increase to compensate for the supply shortfall.

Despite the sanctions, Russian oil exports for the week of April 2-8 rose to a maximum level this year - 4 million barrels / day.

Amid rising US inflation to its 40-month high (8.5% higher in March than last year), President Biden on Tuesday announced a temporary permit to sell E15 gasoline (containing 15% ethanol). , which is prohibited from sale from June to September, which will reduce prices for automotive fuel. Gasoline prices in the United States are 48% higher than last year, primarily due to measures taken after Russia's invasion of Ukraine.

The E15 marketing authorization will increase corn consumption in the United States, to which grain prices have responded by rising to regular highs.

On the Chicago Stock Exchange in May, corn futures, despite the USDA bearish report, rose 2.5% in three sessions to $ 305.6 / t, while Black Sea corn futures fell 2.9% to $ 355. $ 75 / t against the background of continued blocking of exports from Ukrainian ports.

Exports of corn from the United States for the week fell to 1.418 million tons, and in total in the season amounted to 32 million tons, which is 18.4% lower than last year and is 50.4% of the forecast for 2021/22 MY.

Ukraine continues to increase the supply of corn to the western border and has intensified supplies to Romanian ports, which will allow producers to obtain at least some funds for sowing.

Currently, the demand prices for Ukrainian corn are:

• 230-240 $ / t with delivery by car or railway CPT - ports Reni, Izmail,
• 250-260 $ / t with delivery by rail DAP - border with Poland,
• 300-310 $ / t with delivery by rail to the port of Constanta (Romania).