Despite the collapse of stock market quotes, corn prices in Ukraine continued to grow

Ukrainian farmers continue to hold back corn sales, receiving higher prices, as traders have increased purchase prices by $10-15/t over the past month due to lower freight and port handling costs.

 

The cost of transporting corn by Panamax from Ukrainian ports to Southern China has decreased from $40-50/t to $32-35/t amid reduced import demand from China.

 

During the week, corn prices in Black Sea ports increased by another 200-300 UAH/t to 10,500-10,600 UAH/t or $222-225/t, which corresponds to the price level for feed wheat and barley.

 

Corn exports continued to slow in February, and in the first 24 days amounted to 1.74 million tons compared to 2.46 million tons last year. In total, in the 2024/25 MY (as of February 24), Ukraine exported 14.13 million tons of corn, which is 9.2% less than last year's 15.44 million tons. By the end of the season, Ukraine may export about 9 million tons of grain, but competition with Argentina will intensify from April, and with Brazil from August.

 

The Baltic Exchange's dry cargo sea freight index, which measures rates, rose 40 points on Friday (for the seventh consecutive session) to a monthly high of 981 points. The Panamax index, which tracks vessels with a carrying capacity of 60,000-70,000 tons, rose 26 points to a 3-month high of 1,170 points, and the Supramax index (for smaller vessels) rose 20 points to 886 points, extending a 14-day rise.

 

Accelerated sowing in Brazil and rains in Argentina have halted the speculative rise in world corn prices. According to AgRural, as of February 20, 64% of the planned area had been sown with second-crop corn in Brazil, which is in line with the 5-year average. Dry weather next week will allow for the completion of sowing in optimal terms with significant soil moisture reserves.

 

Yesterday, March corn futures fell:

• on the CBOT exchange in Chicago – by 1.9% to $190/t (-2.7% for the week), returning to the level of the previous month,
• on the Euronext exchange in Paris – by 0.5% to €215.25/t or $225.4/t (+0.7% per week, +0.7% per month).

 

US corn exports in 2024/25 MY amounted to 24.87 million tons, which is 32.3% higher than last year's pace. However, according to USDA forecasts, about 37 million tons of corn will need to be exported over the next six months, which will increase pressure on world prices, especially against the backdrop of a forecast increase in sowing areas.

 

CoBank forecasts that U.S. farmers will increase corn acreage by 4.2% to 94.5 million acres in the spring of 2025 amid high grain prices, tight global supplies, rising demand and record ethanol production. At the same time, soybean acreage will decrease by 3.6% to 84 million acres, spring wheat by 5.9% to 10 million acres, and sorghum by 9.5% to 5.7 million acres.

 

Ukrainian farmers should take advantage of the current high corn prices and accelerate sales, as low European corn prices may reduce demand for expensive corn from Ukraine in March-April amid active sales of the new crop from Argentina.