Global Quotations and Planting Completion
The recent stabilization of corn prices in Ukraine is primarily influenced by global market trends, notably the completion of planting in the United States and the improved condition of corn crops in both the U.S. and Ukraine. This has increased pressure on global quotations, halting the upward price trend in Ukraine. However, prices continue to be supported by the gradual increase in feed wheat export prices.
US Corn Planting Progress
According to data from the National Agricultural Statistics Service (NASS), as of June 2, 91% of the planned corn area in the U.S. had been planted (compared to 95% last year and an average of 89% over the past five years). Additionally, 75% of the crops are reported to be in good or excellent condition, a notable improvement from 64% last year.
Price Movements on Global Exchanges
On the Chicago Board of Trade, July corn futures dropped by 3.4% over the week to $172.9 per ton (-6.6% for the month), while December futures fell by 4.3% to $180.7 per ton (-6.3%). These prices are currently 10% lower than last year. Last June, unfavorable weather pushed prices to $220 per ton, but they decreased over the season due to low export demand.
Similarly, on the Euronext exchange, August corn futures fell by 1.6% to €223.25 per ton ($243.4 per ton, +7.6% for the month), and November futures declined by 2.8% to €221.5 per ton (+5.5%).
EU Corn Import Trends
The European Commission reports that corn imports to the EU in the 2023/24 season have decreased by 32% compared to the previous season, totaling 17.1 million tons. Of this, 11.6 million tons were supplied from Ukraine, with Spain importing 7 million tons, the Netherlands 2.3 million tons, and Italy 2 million tons.
Ukrainian Corn Planting and Market Conditions
As of May 31, Ukraine had sown 3.9 million hectares or 97.5% of the planned corn areas. Recent rains are expected to improve crop conditions, while the low temperatures forecasted for the next 7-10 days will support plant development.
Corn Purchase Prices and Export Data
After a decrease last week, corn purchase prices in Ukraine have recovered to $182-185 per ton or UAH 8,300-8,400 per ton with delivery to Black Sea ports. This recovery is supported by the increase in feed wheat prices, which have risen by another $8-10 per ton to UAH 9,100-9,300 per ton, driven by the rise in food wheat prices to $210-215 per ton.
In the 2023/24 marketing year, as of June 3, Ukraine exported 26.6 million tons of corn, close to the USDA forecast of 26 million tons. By the end of the season, there is potential to export another 1.5 million tons, significantly reducing final stocks.
Future Price Influences
In the near future, corn prices may be further influenced by harvest data from Brazil and Argentina. As of May 30, Brazil had harvested 4.7% of its second-harvest corn area (compared to 1.4% last year). The AgRural agency has lowered its 2023/24 harvest forecast to 118.4 million tons, significantly below the USDA forecast of 122 million tons and the 137 million tons collected last year.
The current stabilization of corn prices in Ukraine amid global market trends underscores the interconnectedness of agricultural markets. While the improved crop conditions and completion of planting in the U.S. have halted the upward price trend, the increasing feed wheat prices continue to provide some support. Stakeholders should keep a close watch on global developments, particularly in Brazil and Argentina, which could further influence market dynamics.