Export demand for corn in Ukraine will be high until the end of June, and from July, the supply of the crop from South America will increase on world markets
Rain in Argentina and Brazil has slowed corn harvests, allowing Ukrainian farmers to benefit from unexpectedly high June prices—$220–222/t—amid low domestic supply. Forward prices for October rose to $198–200/t. However, price gains may be capped as Argentina’s and Brazil’s harvests progress. Despite delays, Argentina’s output forecast remains at 49 million tons for 2024/25.
Rains in Argentina and Brazil are delaying the corn harvest, allowing Ukrainian farmers to receive high prices for corn in June, although analysts had expected them to decline under pressure from supply from South America.
Last week, export demand prices for corn at Ukrainian ports remained at $220–222/t or UAH 10,400–10,600/t, as traders bought up small lots, while supply from farmers was at a low level.
Forward prices for new crop corn for October delivery rose by $3-4/t to $198-200/t amid higher quotes on the Paris stock exchange, but wheat and corn harvests in Argentina and Brazil will limit price increases, and futures in Chicago have already fallen.
Against the backdrop of dry weather in the corn growing area, August corn futures in Paris on Euronext rose by 5.8% to 198.75 EUR/t or 228.4 $/t (-0.5% per month), and November futures rose by 4.7% to 207.5 EUR/t or 238.5 $/t (+2.2%).
July corn futures on the Chicago SWOT fell 3.5% to $168.9/t (-7.2% month-on-month) under pressure from improved crop forecasts in Argentina and favorable weather in the US, but December futures fell only 0.5% to $173.3/t (-2.2%).
The offer prices for Argentine corn are currently lower than for American corn, and in July-August a record second crop of corn will hit the market, which has now been threshed on 10% of the area.
According to the Buenos Aires Grain Exchange, corn in Argentina has been harvested on 50% of the area, and in some regions the yield exceeded the forecast, although prolonged rains are delaying the harvest. Therefore, the production forecast for the 2024/25 MY has been left at 49 million tons.
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Source : Ukr Agro Consult
