Corn prices rose to a 10-year high amid new oil prices
Russian troops have launched a massive offensive in southern and eastern Ukraine, which could be the defining battle of this war. Heavy shelling and bombing of cities and fortifications immediately increased the likelihood of a sixth EU sanctions package against Russia, including an oil embargo.
Oil prices continue to rise, which began late last week, supporting corn prices. June futures for Brent crude oil at London's ICE Futures rose 7% to $ 113 / barrel for the week and US futures for WTI crude oil rose 6% to $ 108.2 / barrel, the highest in three weeks. The market remains under pressure to cut oil supplies from Russia by 1 million barrels per day, and tightening sanctions will reduce supplies by 3 million barrels per day from May compared to 7-8 million barrels that Russia exported before the war.
Libya has also cut oil supplies by 0.5 million barrels due to tensions between the government and rebels who have blocked shipments in ports, fueling civil strife and increasing pressure on world oil prices. It will be recalled that among the insurgents there are more than 1,000 Russian Wagner mercenaries.
Over the weekend, Saudi Arabia's Prince Mohammed bin Salman held talks with Putin, during which the parties "positively assessed" the cooperation with the OPEC + group of producers to stabilize the world oil market. This means that OPEC + is satisfied with current prices and will not increase production despite the calls of the United States and its allies.
The Covid outbreak forced Chinese authorities to impose quarantine restrictions in 26 of the 31 provinces, although in early March they were imposed in 12 provinces. This will reduce oil consumption in the country by 1.2-1.3 million barrels / day.
Crude oil production in the US is growing, and according to Baker Hughes, the number of active drilling rigs for the week of April 9-15 increased by 2 units to a 2-year high of 548 units, then in August 2020 their number fell to a 16.5-year low - 172 шт.
Following oil prices, corn futures in Chicago yesterday rose 2.9% to cross the psychological level of $ 8 / bushel, reaching a 10-year high of $ 320.5 / ton.
Export shipments of corn from the United States for the week of April 8-14 decreased by 29% to 1.139 million tons, and in total reached 33.2 million tons in the season. , 5 million tons.
Cold and humid weather is delaying the sowing of corn, and as of April 17, 4% of the planned area was sown with grain, which is 2% lower than the average 5-year figure.
Ports in Ukraine remain blocked, making it difficult for farmers to sell corn. Traders are trying to export stocks to Poland or Romania, but due to overcrowding at stations at border crossings, Ukrzaliznytsia has already limited the supply of cars.
Demand prices for supplies to Constanta, Romania, fell another $ 10-20 / t to $ 295-305 / t, while demand prices for CPT supplies to the port of Reni or Izmail remain at $ 245-250 / t, but long queues limit procurement.
