Corn prices in the US are falling, but they are supported by active demand

because of the uncertainty with the signing of the first part of the trade agreement between the US and China yesterday, December corn futures in Chicago continued to fall and dropped to 148,5 $/t, even in spite of increased exports and increased ethanol production in the United States.

the increase in ethanol production over the last week on 3 thousand barrels/day up to 1,033 million barrels/day, which is necessary to alter weekly 2.75 million tons of corn, did not support prices.

a Decline in prices for U.S. corn remains the only way to increase the demand from Latin America and Southeast Asia. Corn prices in the US remain at the level of 172 $/t FOB compared to 176 $/t for Brazil, 168 $/t for Argentina and 170-172 $/MT Ukrainian corn.

Active shipments of corn from Brazil, which in November can export 5 million tonnes, resulted in a reduction of reserves and increase in domestic prices. This forces farmers to increase export sales of grain, which is already 50% higher than last year.

According to the Agency Conab, compared with 2019 the year of the sowing area of maize will increase by 2% to 17,535 million hectares, however, due to the decrease in the yield of production fell by 1.7% to 98,366 million tons to harvest corn in Brazil starts in February.

Buy a South Korean refiner 60 thousand tons of corn at a price of 205 $/t CFR for delivery in March when the market will come back Brazil, pressuring prices for delivery at a later date. In November, South Korean refiners have purchased 750 thousand tons of corn.

In Ukraine, the price of maize at the port rose to 155 and 156 $/t, however, due to the strengthening of the national currency hryvnia prices remain at the level of 4450-4480 UAH/t Due to increased demand from India price of domestic maize rose to 170 $/t FOB.

Indian national Federation of agricultural cooperatives (NAFED) has announced a tender to purchase 100 thousand tons of Ukrainian corn for delivery 10-31 January, the results of which will be announced after December 3rd.

increased competition on world markets and lower prices for U.S. corn in the near future will limit the rise in price of Ukrainian corn. And favorable weather in Brazil and Argentina and an increase in supply of South American corn will put pressure on prices in the spring.