Purchase prices for corn in Ukraine are falling due to the shutdown of terminals in the Black Sea ports

In January, compared to December, Ukraine reduced the export of agricultural products by 24% to 5.5 million tons, in particular, corn - by 27% to 2.6 million tons, wheat - by 19% to 1.3 million tons, as a result of deliberate blocking by Russian inspectors inspection of ships and the lack of energy supply in the Black Sea ports during the last 10 days due to shelling of the energy infrastructure of Odesa.

Against this background, the purchase prices for corn in the Black Sea ports fell from $210-212/t to $200-205/t, as the additional costs of traders for idleness of vessels waiting in inspection queues rose to $30-40/t.

Thus, at the tender in Egypt, the price of Ukrainian corn loaded onto a ship was $308/t FOB, although now purchases are at $225-245/t FOB.

The state-owned Egyptian operator GASC purchased from Egyptian African Co. through a direct agreement. Two consignments of Ukrainian corn of 30,000 tons for delivery in February-March at a price of $308/t FOB + freight $15/t = $323/t CFR.

The state agency of Algeria, ONAB, purchased 30,000 tons of presumably Argentine corn at an international tender for delivery in March at a price of $339/ton C&F.

Rains in Argentina last week improved the condition of the late corn crops in the central regions. Now 15% of crops are in average or poor condition, not 35% as before. Rainfall expected this week could improve corn crop potential, although ahead of the USDA report, analysts cut Argentina's corn output forecast by 3.5 million tonnes, which would see global stocks fall by 1.5 million tonnes to 294.5 million tonnes.

March corn futures on the Chicago Stock Exchange are trading at $266/t, little changed for the week, but weak US exports are putting pressure on prices, especially amid improving weather in Argentina.

During the week of January 27 - February 2, the export of corn from the USA decreased by 13% to 480,000 tons, which is 55% less than the corresponding indicator last year. In total, 12.5 million tons were shipped in the season, which is 33% lower than last year's pace.

In Ukraine, 9% of corn crops remain unharvested, the quality of which is likely to be unsatisfactory due to the January thaw. Therefore, the market is waiting for the updated USDA forecast for Ukraine.

IC UAC according to GrainTrade