Ukrainian corn was assessed at $162.75/mt Monday by S&P Global Platts, 50 cents lower on the day, taking it to a twelve month low as buyers remain on the sidelines and global stocks mount.
Prices have now slid over $33, since reaching its highest point of $196/mt during this marketing year two months ago when fears were sparked of a grains shortage due to a prolonged drought and heat wave across Europe and the Black Sea region.
The vigorous buying during this period led to end-users, namely EU animal feed buyers, covering themselves well in the run-up to winter, which has led to a lack of buying during this period.
"I'm desperately trying to sell but I cannot find buyers," a source said as bids move lower and offers chase them.
Other markets such as Egypt have gone through changes in domestic trends, moving from poultry production to more frozen poultry imports, ultimately leading to less domestic demand.
Subsequently, stocks in Egypt are particularly high, leading to domestic sellers in the market trading well below replacement, and thus keeping any fresh sales from the Ukraine out of the market.
Similarly, Ukraine is expected to have a record corn harvest of 31 million mt, according to the most recent USDA WASDE report, as good rainfall in July significantly improved soil moisture.
US stocks and production are high while Brazil still has plenty of corn to shift as it prioritizes soybean exports to China because of a Chinese tariff on the import of US soybeans.
Sources expect demand to pick up in the first quarter of 2019, however, with Brazil expected to return to the market with more corn exports and term contracts from 2017 still finding their way out of Brazil, prices are likely to remain under some pressure.
