Corn prices rise in Ukraine despite large stocks: fertilizers are heating up the market

Despite significant stocks, corn prices in Ukraine continue to rise. The market supports stable exports at about 2.3 million tons per month, and expensive fertilizers remain the key factor in the price increase. This was reported by the analytical department of the agricultural cooperative PUSK, established within the All-Ukrainian Agrarian Council.

“A gradual strengthening of prices is being recorded on the domestic corn market. According to PUSK estimates, last week, quotes were in the range of $214–216/t CPT port, with large batches of 3–7 thousand tons traded at $217/t, and individual deals reached $218/t. The market is expected to maintain its upward momentum at least until mid-April,” PUSK analysts note.

A key factor in the new season is the situation with fertilizers, which have become more expensive due to the war in the Middle East. In Ukraine, farmers are starting to sow in conditions of their high cost, which is already affecting the approach to growing corn as the most resource-intensive crop.

“The fertilizer factor is now one of the determining factors. The high cost of resources is forcing farmers to review technologies, and some farms may reduce their application. This will directly affect the potential yield and supply in the new season,” the PUSK believes.

At the global level, this factor is even more pronounced. In particular, in Brazil, some producers may refuse to fully apply fertilizers for the second corn crop due to their high cost.

“In Brazil, there are already signals that some farmers will not apply fertilizers for the second corn crop, which is sown after soybeans. This is due to high resource prices and the fact that they have already received their main income from soybeans. Despite the ability of soybeans to fix nitrogen in the soil, this is not enough to form a full corn crop. Accordingly, the yield may be lower than expected, which will affect the overall market balance,” the analyst notes.

The world corn market currently remains balanced, but this balance is quite sensitive.

“In fact, the entire volume of corn production in the world is consumed. At the same time, the difference between production and consumption is minimal. In the new season, a scenario is possible when consumption exceeds production, and then the market will begin to use reserves. That is why, even with the expectation of large harvests, there are no sharp price drops,” the analysts emphasize.

Thus, despite significant reserves in Ukraine, the corn market retains the potential for growth in the coming weeks.

Tags: prices, corn