Ukraine is losing momentum in corn exports due to increased competition with Argentina

The Ukrainian corn market is finding it more difficult to trade forward contracts due to increased competition from Argentina, according to Spike Brokers.

The Buenos Aires Grain Exchange in Argentina has raised its forecast for corn production in the country from 61 million tons to 64 million tons. Additional grain volumes will increase competition on the world market in June-August.

“Against this backdrop, Ukrainian exports are starting to lose momentum, and the market is taking into account the likelihood of higher carryovers and a more comfortable start to the new season,” brokers note.

Also, due to competition with South America, Ukrainian premiums for summer forward deliveries remain limited, especially for distant export destinations.

At the same time, corn exchange quotes at the end of the week partially recovered after the previous drop. The market was supported by high rates of export sales in the United States.

The export geography of Ukrainian corn in May became wider than at the beginning of the month. In total, from May 1 to 21, Ukraine exported 1.56 million tons of corn. Turkey remains the largest buyer — over 532 thousand tons. It is followed by Italy (197 thousand tons), the Netherlands (146 thousand tons), Israel (112 thousand tons) and South Korea (104 thousand tons).

Corn prices in Ukraine and the world

• CBOT July: 462 c/bu (+8 c/bu)
• MATIF June: 221 €/t (+14 €/t)
• SPIKE CPT Odesa June: 229 $/t (unchanged for the week)
• CPT Odesa, November: 225 $/t
• FCA Chop June: 208-210 €/t (+2 €/t)
• FCA Chop November: 200 €/t

Tags: Ukraine, corn, export, prices, Argentina