Feed corn prices in Ukraine continue to rise

During the week, purchase prices for corn in the ports of Ukraine increased against the background of active demand from importers, a shortage of offers from producers, low transitional stocks and the July heat, which negatively affected the formation of the harvest of late crops.

 

Since Monday, demand prices for corn have increased by $13-17/t to $170-181/t SRT-port.

 

According to the Ukrainian Hydrometeorological Center, the agro-meteorological conditions in Ukraine were unfavorable for the formation of the harvest of late crops, as 30-50% of the areas with crops were covered by drought.

 

At the current stage of development, the most vulnerable to high temperatures is corn, which needs the maximum amount of moisture during flowering. In many areas, as a result of the reduction of productive moisture reserves to a critical level and heat stress, persistent wilting and complete cessation of growth, yellowing and drying of leaves, stems, and in some places plants are observed. The heat sterilizes the pollen, worsens the pollination of plants, leads to the formation of epicotyledons in the beginning, which will eventually reduce the yield of corn.

 

Rain in the past week has brought temperatures down to normal and improved crop conditions slightly, but plants have been hit hard in the southeast. Lower corn harvest forecasts in Ukraine and the Russian Federation support prices for the new crop, but their growth is limited by low prices for fodder wheat, as well as for corn in Chicago.

 

According to the forecast of local agencies, Ukraine will harvest 24 million tons of corn this year, which will be 21% less than last year's harvest.

 

The Russian agency IKAR lowered the corn harvest forecast in the Russian Federation by 3 million tons to 14 million tons (17 million tons last year) due to the heat in the Southern and Central Districts. SovEkon experts lowered the forecast for corn production in the Russian Federation from 14.6 to 13.4 million tons.

 

Against this background, forward prices for corn deliveries to the Black Sea ports in September-November rose by $10-15/t to $170-180/t, which corresponds to the level of feed wheat prices.

 

According to the State Customs Service, in 2024/25 MR (as of July 24), Ukraine exported 1.39 million tons of corn (915,000 tons for the same period last year).

 

December corn futures in Chicago for the week rose only 1.5% to $164.5/t, not reacting to forecasts of reduced harvests in the EU, Ukraine and the Russian Federation, as the weather in the US favors the formation of a good harvest.

 

Agency MARS reduced the forecast of corn yield in the EU from 7.55 to 7.24 t/ha, which will be 2% lower than the 5-year average of 7.35 t/ha.

 

August corn futures in Paris rose 3.9% during the week to €220.5/t or $239/t, which will support Black Sea corn prices.

 

According to Conab data, in Brazil, as of July 21, corn of the second crop has been harvested on 79.6% of the area (47.9% last year), but rains are delaying harvesting.

 

In the coming months, the world market will be dominated by corn from Argentina and Brazil, but from September the demand for Black Sea corn will increase, which will lead to an increase in prices.