Despite the decline in world corn prices, they continue to rise in Ukraine

Speculative gains in wheat prices lifted corn prices, but they eased yesterday amid profit-taking by traders and data on an acceleration in US plantings.

 

Yesterday on the exchange in Chicago, July corn futures fell by 0.5% to $180.3/t (-2.2% for the week, +1.8% for the month), and December - by 0.4% to $190/t (-1.9% for the week, +2.3% for the month).

 

According to NASS, as of May 19, 70% of the planned acreage was planted with corn in the US (50% a week ago, 76% last year, 71% on average for 5 years), and warm weather with periodic precipitation in the next 8-10 days will allow to accelerate planting.

 

In Ukraine, as of May 17, 3.65 million hectares or 91% of the planned areas were sown with corn, but farmers may increase the area of sowing against the backdrop of a rapid increase in prices. Dry, but not hot weather will allow sowing to be completed at the optimal time, but the crops are experiencing a moisture deficit, and rains are not expected until the end of May.

 

Purchase prices for corn in Ukraine in the Black Sea ports during the week increased by another 5-8 $/t to $180-183/t or UAH 8,200-8,300/t after feed wheat prices added another $10-12/ t and reached $185-188/t or UAH 8,300-8,400/t against the background of active export demand.

 

In May, Ukraine exported 2.06 million tons of corn, which significantly exceeds the 1.66 million tons shipped for May 1-20, 2023, and in general, during the season, exports reached 24.96 million tons (26.36 million tons on this date last year ).

 

According to the Conab agency, in Brazil, corn of the first crop was harvested on 72.4% of the area (77.2% last year), and of the second crop - on 0.4% of the area (0.2% last year).

 

In Argentina, according to the Buenos Aires Grain Exchange (BAGE), corn has been threshed in 25.4% of the area as of May 15 (5-year average of 33.7%), and dry weather will speed up harvesting in the coming weeks.

 

China is actively buying corn, and in January-April 2024, compared to the same period in 2023, it increased its import by 6.5% to 9.1 million tons.

 

Lower oil prices, acceleration of corn harvesting in South America and sowing in the USA and Ukraine may lead to lower grain prices in the near future. However, in Ukraine, prices will remain high amid limited supply, and will decrease as early as mid-July, when traders will begin buying rapeseed and barley of the new crop.