South American countries taking away end markets of Black Sea corn

17.01.2018

As market participants expected, the first three months of the 2017/18 season were marked by a redistribution of key players in the world corn market. Growing supply from South American countries adversely affected deliveries not only from the top corn exporter – the USA (down 37% against September-November 2016/17), but also from Ukraine (-40%) and Russia (-29%).

This is no surprise since in September-November 2017 alone Brazil exported 86% of the volume it shipped abroad for the whole last season. So, it beat the USA into second place.

During harvesting in Ukraine and Russia, Brazil and Argentina managed to reduce the export price for their corn to a greater degree. In view of a harvest delay and a possible crop decline, Ukraine and Russia offered their corn at prices which were by $15-20/MT higher than South American offer, UkrAgroConsult notes.

This season’s decrease in competitiveness of Ukrainian corn badly hit primarily its main end market, i.e. the EU. The markets of Egypt, South Korea and Iran also became disappointments in the first three months of the season. The above adversity is somewhat offset by growing interest of China and Turkey in purchases of Ukrainian corn.

Full version of the article is available to subscribers for weekly market report “Black Sea Grain” and “Online market review” by UkrAgroConsult.

 

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