Purchase prices for corn in Ukraine are falling, despite lower harvest forecasts

The delay in the actions of ships to the Black Sea ports of Ukraine in November and December, as well as missile attacks on the energy infrastructure, which caused disruptions and restrictions in the supply of electricity to enterprises, last week stopped the work of some ports and reduced the purchasing activity of exporters.

Purchase prices for corn in the ports of Ukraine last week decreased by $2-4/t to $200-205/t or UAH 7,500-7,600/t due to stoppage of acceptance due to power supply interruptions or lack of free containers due to untimely approach of vessels. Traders have enough of even limited offers from farmers, so they do not raise purchase prices, especially against the backdrop of a decline in world prices.

80 vessels accumulated in the queue to enter the ports of Ukraine. For the stable operation of export terminals, SCC inspectors need to inspect at least 10 vessels daily, but Russian representatives limit their number to 5 or less.

According to the SCC, during the week of December 5-11, deliveries from Ukrainian Black Sea ports decreased by 21%.

Starting from July 1, Ukraine exported 10.5 million tons of corn, of which only 935 thousand tons were exported in December, while last year these figures were 7.8 million tons and 1.75 million tons, respectively.

This week, deliveries intensified, and on December 13, 8 vessels with 238,600 tons of agricultural products destined for Asian and European countries left the ports of Odesa, Chornomorsk, and Pivdenny, and another 23 vessels are under loading.

The market has not yet reacted to the decrease in corn harvest forecasts for Ukraine and the fact that due to bad weather, 35% of crops remain unthreshed. The representative of the USDA in Ukraine forecasts this year's corn harvest at the level of 23.1 million tons, and exports - within 20.2 million tons, while the USDA in December estimated the harvest at 27 million tons (42.126 million tons in 2021), and exports - in 17.5 million tons (27 million tons in 2021). According to the USDA, as of December 12, corn in Ukraine was harvested on only 40% of the area, while the Ministry of Agriculture reported that as of December 9, 66% of the area had been threshed.

According to the estimates of the Ministry of Industry, Trade and Services of Brazil (MDIC), 1.5 million tons of corn were exported for December 1-11, out of the 5.4 million tons predicted for December, and in general, in 2022/23 MR, its exports reached 36.2 million tons. which is 140% higher than last year's pace.

The active export of Brazilian corn is putting pressure on the prices of American and Ukrainian corn, which does not have enough demand, even with reduced production this season.