The purchase prices for corn in Ukraine are falling in line with the world prices
An unexpected increase in the USDA's January report of forecasts of world corn production and stocks in FY 2023/24 led to a drop in stock market quotations, which increased the pressure on purchase prices in Ukraine.
In December, against the background of the stable operation of the Black Sea corridor and ports, the export demand for corn in Ukraine increased significantly, as a result of which purchase prices rose to $158-162/t with delivery to Black Sea ports and to $165-170/t with delivery to Danube ports , and hryvnia prices reached 6,550-6,650 UAH/ton after the rise of the dollar exchange rate to 38-38.2 UAH/$.
Last week, the hryvnia strengthened to 37.8-37.9 UAH/$, so traders adjusted the hryvnia prices, and after the release of the USDA report, they lowered the currency prices by 3-5 $/t to 155-156 $/t (6250-6400 UAH/ t) with delivery to Black Sea ports.
According to the State Customs Service, in 2023/24, Ukraine exported 20.563 million tons of grain and leguminous crops, in particular, for January 1-15 - 2.097 million tons, compared to 24.472 million tons and 1.726 million tons, respectively, in the previous season. The export of corn in the current season amounted to 11.014 million tons, of which 1.388 million tons for January 1-15, so the forecast USDA export volume of 21 million tons looks real. In 2022/23 MR, Ukraine exported 27.1 million tons of corn thanks to active deliveries to the EU. For the current season, the import forecast for the EU has been reduced from 24.5 to 23.5 million tons, which almost corresponds to last year's level, but blocking the borders of Ukraine will not allow to increase deliveries by road transport.
According to the European Commission, in the 2023/24 FY (as of January 7) the EU imported 9.03 million tons of corn, which is 43% less than the previous season's figure of 15.84 million tons. Spain became the main importer of corn (3.95 million t), Italy (1.05 million tons) and the Netherlands (1.04 million tons), and the largest grain suppliers are Ukraine (5.15 million tons or 57% of all imports) and Brazil (2.77 million tons or 30, 7%). At the same time, in the current season, the EU increased corn exports by 139% to 2.1 million tons, of which Romania sold 1.39 million tons.
Ukrainian corn remains the cheapest on the world market, and demand for it will remain high until March, when Argentine corn will enter the market. Moreover, American farmers are in no hurry to sell their grain at low prices in anticipation of a seasonal reduction in corn supplies from Brazil.
