Purchase prices for corn in Ukraine continue to rise

Demand prices for corn in Ukraine continued to rise last week amid strong export demand and curbing sales by producers looking for the best price.

Purchase prices increased by $2-3/t to $150-153/t or UAH 5,900-6,100/t with delivery to Black Sea ports and $158-162/t or UAH 6,200-6,300/t with delivery to Danube ports. Producers are selling corn in small batches in anticipation of further price increases, forcing exporters to raise prices to meet contracts.

Currently, 26.08 million tons of corn with a yield of 7.58 tons/ha have been harvested in Ukraine from 3.44 million hectares or 84% of the area. The export of corn in 2023/24 MR amounted to 6.18 (9.6 million tons last year) of the USDA forecasted 12 million tons of corn, in particular in November - 2.38 million tons.

Analysts expect USDA experts to change the corn export forecast for Ukraine and sharply raise the production forecast for the US in the December report, which could lead to a drop in quotations, especially given the improvement of the weather in Brazil and Argentina.

On Friday, December corn futures rose 1.4% to $184.4/t (-1.9% for the month), and March futures rose 1.2% to $191.4 on the Chicago Stock Exchange /t against the background of increased export sales from the USA.

Export sales of corn from the USA for November 16-23 increased to a record 1.93 million tons in the season, and in general in 2023/24 MR reached 24.5 million tons, which is 33% higher than the corresponding figure last year.

According to NASS, 11.72 million tons of corn were used for ethanol production in the United States in October, which was the highest figure since October 2017, and the total for September-October was 22.66 million tons, which is 7.2% higher. than last year At the same time, ethanol prices in the US in November decreased from $0.47 to $0.43/l against the backdrop of falling oil prices and fuel demand.

Central Brazil has seen steady, albeit light, rains, which is helping soybeans grow and easing concerns about the timing of second-crop corn and a possible cut in corn production.

Increased sales of old-crop corn from Argentina in the new year, amid higher forecasts for the new crop (which will begin to be harvested in March), will sharply increase the pressure on quotations in early 2024, especially given the increase in offers from Ukraine and significant unrealized balances in the US.