Decrease in demand lowers corn prices

2020-12-08 12:02:49
Machine translation
Decrease in demand lowers corn prices

On the corn market pressure reduction demand from major importers due to too high prices, but it receives support from the lack of precipitation in South America.

 

Yesterday on the stock exchange in the U.S. corn initially decreased by the data on the low rate of exports, but later resumed due to the forecasts of reduction of the first crop of corn in Brazil and delayed sowing in Argentina. December futures traded at 165,1 $/t, March – in to $ 166.5 $/t

 

Weekly maize exports from the USA were worse than expected and amounted to 734 thousand tonnes, of which 43% was shipped to Mexico and 38% to China. Since the beginning of the season, the US exported 11 million tons of corn, so to achieve the projected level of exports 67 million tonnes in the future you need weekly export 1.4 mln t

 

the prices presses a slowdown in purchases by China, which contracted 11 million tons of U.S. corn, but has shipped only 3.3 million tons.

 

News about the purchase of Chinese state-owned company Cofco 1 million tons of corn from Brazil reinforces the pessimism about the possibility of increasing U.S. exports, although the Brazilian corn is almost not available in China because the two countries have no agreed upon sanitary standards. So maybe batch will be delivered to other countries.

 

Experts Agrural lowered its forecast for first-crop corn in Brazil by 1.3 million tonnes to last year's level of 19.7 million tons of soybeans Sowing is done at the level of last year, so the delay of sowing of the second crop of corn will not. Precipitation this week will improve the condition of the soybeans and corn in the country.

 

In Argentina, because of the shortage of rain the corn planted 35% of areas, compared to 49% in 2019.

 

Precipitation in South America have lowered the price of corn. South Korean processors bought a batch of corn for delivery in June at a price of 237 $/t C&F, while batch delivery Feb – March bought at 255-256 $/t C&F.

 

amid low demand for Ukrainian corn prices remain at the level of 230 $/ton FOB, while the bid price is $225/t FOB. On the background of falling demand, purchasing prices in the ports fell to 212-214 $/t or 7200-7400 UAH/t. the demand from processors has also declined, as a result they reduced the prices up to 6600-6800 UAH/t with delivery to the plant.

 

Farmers stopped selling after a decline in prices by 10-15 $/t, however, the fall in world prices will continue to put pressure on the market.

 

In the current season Ukraine exported of 5.12 million tons of corn, which is 29% below the corresponding indicator 2019 Demand from China are insignificant, and the EU is also declining. Since the beginning of the season, the EU imported only 7.2 million tons of corn, which is 23% less than last year.

Visitors’ comments (0):