Corn futures fell 3.3% amid falling oil prices and favorable rainfall

A drop in oil prices of more than 7% in a week has led to a drop in near-term corn quotes, while good weather conditions in the US, EU and Ukraine are promoting crop development and increasing pressure on new crop prices.

OPEC+ countries decided in June to increase oil production by 411,000 barrels per day to more quickly offset a two-year production cut of 2.2 million barrels per day. Saudi Arabia has threatened to increase production even further to lower oil prices and punish countries that produce and export oil above their limits, including Iraq and Kazakhstan.

July Brent crude futures fell 7.5% to $60.3/barrel for the week (-5.8% for the month), but were supported on Monday by an unexpected improvement in the US services sector index.

Quotes were also supported by data on increased demand for crude oil in China, which increased its imports to 12.1 million barrels/day, the highest figure since August 2023.

Falling oil prices and favorable weather for corn planting in the US, Brazil, the EU, and Ukraine caused grain prices to plummet yesterday.

On the Chicago Board of Trade, July corn futures fell 3.3% to $178.8/t on Monday (-6.4% for the week), and December futures fell 1.7% to $174.4/t (-1.6% for the week) amid accelerated planting and forecasts of a higher harvest in Brazil.

Thanks to favorable precipitation for second crop plantings in March and April, Celeres raised its forecast for Brazil’s corn harvest by 0.8 million tons to 135.4 million tons.

According to the USDA crop report, as of May 4, 40% of the planned area in the United States had been sown with corn (39% on average over 5 years), and seedlings had been obtained on 11% of the area (9% on average over 5 years).

Corn exports from the United States fell 3.5% to 1.61 million tons between April 24 and May 1, and totaled 42.5 million tons for the season, up 28.8% from last year. About 22 million tons of grain still need to be exported by the end of the season.

In Ukraine, export prices for corn in Black Sea ports remain at $238-242/t or UAH 11,250-11,400/t, but demand is beginning to decline following the fall in world prices and against the backdrop of rains that improve the prospects for the new harvest.

Currently, half of the planned areas in Ukraine have been sown with corn, and precipitation and low temperatures in the next 7 days will allow the completion of sowing and will contribute to the development of crops.

Corn exports from Ukraine in the 2024/25 MY (as of May 2) amounted to 18.64 million tons (out of the projected 22 million tons), which is 23.7% lower than the corresponding figure for the previous season (23 million tons).

South Korean Major Feedmill Group (MFG) last week purchased about 65-70 thousand tons of feed corn from CHS in a tender for delivery to South Korea in early August 2025 at a price of $248.4/ton C&F.

This indicates a gradual decline in corn prices, so Ukrainian farmers should accelerate sales at currently high prices.

Tags: corn, prices, Ukraine