Improved crop conditions in Argentina and faster harvesting in Brazil are increasing pressure on corn prices

Traders ' attention is focused on the weather in South America, for which local analysts lower their forecasts for soybean production, although for corn they are left at higher levels than last year, as precipitation in January improved the condition of crops.

In Argentina, the number of crops in good or excellent condition increased from 22% to 32% in a week, and precipitation forecast for the coming days will further improve the condition of crops.

According to SAFRAS&Mercado, as of January 28, Brazil's first-crop corn was harvested on 20.5% of the total area sown on 4.385 million hectares (14.4% last year and 8.8% on average over 5 years), in particular in Rio Grande do Sul-by 49.8%, Santa Catarina-by 32.3%, Paraná – 4.9%, Sao Paulo-3.5%.

Heavy rains in Brazil delay soybean harvesting and corn sowing of the second crop, but replenish soil moisture reserves.

March corn futures on the Chicago Stock Exchange recovered to вчора 250/ton yesterday after falling on Monday on data on an increase in US corn consumption for ethanol in December, while December futures are trading at.227/ton, despite forecasts of a reduction in sowing areas in 2022.

According to the USDA, in December, corn consumption for ethanol in the United States increased to the highest level since December 2018, and in general in the season reached 46.43 million tons, which is a 3-year high for the first 4 months of the season and is 34.3% of the annual forecast of WASDE.

Today's ethanol production report is expected to reduce production data and increase ethanol stocks, as it did in January. 

March Black Sea corn futures on the Chicago Stock Exchange rose to вчора 288/ton after falling on Monday yesterday, but they are under pressure from falling wheat prices.

In Ukraine, corn prices at the beginning of the week fell to 2 268-270/ton or UAH 8550-8650/ton amid an increase in offers from producers.

On February 8, the Turkish TMO agency will hold an international tender for the purchase of 325 thousand tons of feed corn of any origin, which will become an indicator of prices for Black Sea grain.

Brent crude prices remain below 9 90/barrel in anticipation of the OPEC+ meeting to be held today. Presumably, they will decide to increase oil production by 400 thousand barrels/day every month, and maybe even more, which should reduce world prices.

March European corn futures on Euronext Paris rose 3.75 €/ton to 253 €/ton or 2 285.2/ton after falling 8 €/ton on Monday, while November futures are trading at 231.25 €/ton on forecasts for increased production in the EU.