Another decrease in the corn harvest forecast in the EU supports quotations at a high level
According to the forecast of COCERAL (Organization of European Grain Traders) experts, this year's corn harvest in the EU will not exceed 52 million tons, while last year it amounted to 70.2 million tons, and the USDA estimated it at 56.2 million tons in October.
After significantly lowering France's corn crop forecast due to prolonged summer drought and heat, the German Cooperative Union (DRV) lowered its corn production estimate for Germany to 3.54 million tonnes, down 20.2% from last year. Romania and Hungary, which are significant corn producers in the EU, have also been affected by the drought.
Against the background of reduced production, the European Union has sharply intensified the import of corn, which in 2022/23 MR has already reached 8.39 million tons, which is twice the 4.08 million tons exported during the same period last year. We will remind that according to the forecast of the USDA, the EU will export 20 million tons of corn this season, which will correspond to the level of the previous season. But given the pace of imports in the first 3.5 months of the season, we can expect an increase in the volume of purchases. Activation of imports by the European Union reduced stocks of corn of the old crop in Ukraine and supported the market.
November corn futures on Paris Euronext fell 4.3% for the week to €327/t or $320/t (-1% for the month) on the USDA report and under pressure from a seasonal increase in supply and falling prices for US and Ukrainian corn.
On the Chicago Stock Exchange, December corn futures for the week fell by 1.9% to $267/t (-1.7% for the month), and November - by 2.5% to $286.5/t (- 6.8% per month).
American corn prices are being pressured by high harvesting rates in the US, where 45% of the area was threshed as of October 16, compared to 40% on average over 5 years. However, the quote supports an increase in ethanol production to 1.06 million bpd, which crossed the 1 million bpd level for the first time since August 5, thanks to stronger demand for auto fuel.
In Ukraine, demand prices for corn with delivery to the port remain at the level of $185-215/t, however, queues of cars for unloading and ships for loading remain. Demand prices with delivery to the western borders decreased to 240-250 €/t DAP - the border with Poland and Hungary.
ANEC experts have raised their forecast for October maize exports from Brazil to 7.18mt, well above the 1.87mt exported in October 2021, with a good summer maize crop and favorable winter planting weather conditions adding pressure in the near term. on prices
