Corn and wheat prices in Ukraine have decreased: farmers are in no hurry to sell grain

Despite the increase in the risk premium on the global grain market, the Ukrainian physical market went in the opposite direction last week. The almost complete cessation of trade through seaports led to a drop in grain prices on a port basis and a loss of market liquidity. This was reported by analysts at Spike Brokers.

Over the week, the SPIKE CPT Odesa index for corn fell to $200/t (-$8), food wheat to $198/t (-$6), and feed wheat to $188/t (-$6). The FCA Chop index for corn adjusted to $228/t (-$6), which also indicates restrained trading activity even on alternative export routes.

Analysts note that the activity of trading in the new crop for corn on the Ukrainian market remains limited.

“In the direction of seaports, the conclusion of new contracts has practically ceased, therefore the price levels of CPT Odesa are mainly nominal in nature and do not reflect a liquid market,” the report states.

A gradual revival is beginning to be observed in the Danube direction, where exporters are reorienting logistics. The western border remains the main alternative export channel, although its capabilities are limited by both the Ukrainian transshipment infrastructure and large-scale repair work on railway routes through the Czech Republic towards Italy and Germany.

Buyers of the new crop on the western border are announcing indicative prices of €205–207/t with delivery in November–January, but the number of concluded contracts remains insignificant. Most producers are taking a wait-and-see approach, waiting for the resumption of sea exports and further development of the world market.

The situation is similar in the wheat market. After a sharp increase last week, world prices have started to correct, but the security situation in the Black Sea region remains one of the key factors in pricing.

Purchasing activity in the direction of deep-water ports is almost absent. Exporters are gradually reorienting logistics to Danube ports, where trade activity has begun to resume in recent days.

“Despite the active harvest, most producers are in no hurry to sell the new crop. In the absence of stable operation of the sea export channel, sellers are not ready to fix prices at current levels and are mainly taking a wait-and-see position. This limits the supply on the physical market and shifts trading activity towards the fulfillment of previously concluded contracts and the development of alternative export routes,” the analysts explain.

Tags: Ukraine, corn, prices, wheat