Warm and dry weather in the US and Ukraine to speed up harvesting corn.
United States over the past week have reduced the harvesting and threshing already 63% areas, corresponding to an average 5-year index. However, rainfall in the next week may slow the pace of harvesting.
In Ukraine 70% area harvested 22,5 million tons of corn with a yield 7 t / ha, which gives hope for a harvest within 32 million tons.
Proceeds to the markets new crop corn puts pressure on prices. Chicago corn futures since the start of the week fell to 1,9% to 143,3 $/so against the background of falling stock indices and oil prices and soybean.
The demand for corn in the US remains low due to the growth of the South American corn proposals, which after the reduction of soybean exports from Brazil began to actively enter the market.
For a week the export of maize from the United States fell to 36,2% to 653 kt.
It grows on cheap grain demand from Korean refiners, who purchased several lots of South American corn costs 198-200 $/Т CFR.
Due to the low demand for corn prices in Ukraine remain at 160 $/т FOB. Romania, which will bring together a record harvest of maize at 14-15 million tons, It compensates for the decline in production in Germany and France, so the chances to strengthen domestic export of maize in the EU are very small.
Due to the drought in the European part of Russia the corn crop is reduced to 10 million tons, while exports will be reduced to 1,7-2 million tonnes against 5,5 million tons last year,. This will reduce the competitive pressure on the Ukrainian corn, because the asking prices for grain in Russia remain at 170 $/t FOB, and it is unlikely to fall due to high domestic prices processors.
Reduction in soybean and meal China consumption thanks to new standards on animal feed will lead to increased consumption of corn. The rise in corn demand from China can stop the fall in maize prices in Ukraine, which is now down to the port to its lowest level 12 months and up 147-148 $/t or 4800-4950 USD / t.