The purchase prices for corn in Ukraine are increasing in line with world quotations

Export prices for corn in Ukraine are rising in line with global quotations amid forecasts of a reduced harvest and limited supply from producers.

December corn futures on the Chicago Mercantile Exchange fell to their lowest level since 2020 on Monday, but have since risen 3.8% to $161.7/t (+1.5% for the month) on forecasts of heat in USA and a possible decrease in harvest in Ukraine, Argentina and Brazil.

According to Reuters, in Argentina in the current season, farmers will reduce the area under corn in favor of soybeans, which will be sown the largest area in the last 10 years. The abandonment of maize is due to the fact that the 2023/24 crop has been affected by leaf-eating insect plague, while current rain forecasts are more favorable for soybean crops than maize. Analysts of the Rosario Grain Exchange believe that, under the pressure of these factors, the area under corn in 2024/25 may decrease by 17-21% or 2 million hectares in favor of soybeans.

Dry and hot weather in Brazil is delaying planting of first-crop corn and soybeans, which will later delay planting of second-crop corn. In August, the country exported 6.063 million tons of corn, which is 35.25% lower than the corresponding indicator of 2023 and is the lowest August indicator since 2020 and the second lowest indicator in the last 6 years. Farmers are in no hurry to sell corn at low prices, given the unfavorable conditions for sowing the new crop.

November corn futures on the exchange in Paris increased by 2.3% to 202.75 €/t during the week (which corresponds to the level of last month), almost not reacting to the next forecasts of a decrease in the harvest in the EU.

In Ukraine, 457.5 thousand tons of corn were harvested from 4 million hectares or 2% of the area with a yield of 5.7 tons/ha.

Purchase prices for corn for the week increased by $5/t to $175-180/t or UAH 8,100-8,300/t with delivery to Black Sea ports.

According to the State Customs Service, in the 2024/25 fiscal year (as of September 4), Ukraine exported 2.288 million tons of corn (2.16 million tons in the same period last year), but in August, export rates decreased against the background of very low stocks of the old crop.

At the beginning of the season, traders will keep corn buying prices high to buy the required volumes, but later demand for Ukrainian corn may decrease as competition from cheaper American grain intensifies.