Corn prices remain under pressure growth proposals
After a sharp jump in corn prices in Chicago, due to the unexpected decline in U.S. inventories, traders take profits and wait for a new report USDA.
Good weather conditions of September in the corn belt of the USA has improved the condition of crops, 45% of which was planted after the optimum time, so the market is hoping for an increase in the forecast of crop yield and gross collection.
the Next decade on the South and East of the center of the Middle West, warm and dry weather will contribute to the collection, while heavy rains in the Western and Northern regions will prevent the collection and ripening.
the Pace of harvesting corn in the US is twice lower than last year, but the weather is unlikely this week will be able to reduce the backlog.
the corn Futures in Chicago yesterday fell 1.8% to 152,5 $/t for data on the reduction in the production of ethanol, which is two weeks in a row below 1 million barrels/day, and news on the intensification of corn exports from Argentina due to the possible introduction of fees.
the Daily ethanol production for the week rose by 15 thousand barrels to 958 thousand barrels, however, remains below the average level of 1 million barrels/day. This is the second lowest figure for the last 3.5 years and 60 thousand barrels/day lower than in 2018 To make that amount of ethanol weekly for processing is 2.54 million tonnes of corn.
Political instability in Argentina has led to an increase in the number of registrations licenses for the export of corn, as the new government which may be elected at the end of October, intends to impose export duties. According to the state certificates of Argentina, from April 2019 to March 2020 for export was 32 million tons of corn, compared with 15 million tonnes in the corresponding period of the previous season.
Brazil in September increased corn exports in comparison with last year doubled, to 6.5 million tons. Experts expect that production of grain will increase from 101 million tonnes in the current season to 105 million tons in the next.
Ukraine with 24.2% of the area gathered at 7.24 million MT of corn with a yield of 6.01 t/ha (in 2018 of 5.92 t/ha). The increase in purchase prices in port before 147-148 $/t or 4250-4300 UAH/t has increased sales. However, the price of Romanian maize at 150 €/m or 165 $/t FOB limits the growth of prices of Ukrainian corn.
November futures traded in Paris for 164,75 €/t, therefore, the supply of Ukrainian maize in the EU are quite sluggish, especially on the backdrop of purchases by the EU in recent months of large batches of Brazilian corn.
a Record harvest in South America and an increase in supply from the United States and Ukraine in the near future will increase pressure on prices.