Why Ukrainian corn prices went up, and became more interesting to Egypt than China?


Since the beginning of January 2019, the Ukrainian export market (in terms of CPT-port and FOB) faced the upward trend in feed corn prices, which became more intense for 2 recent weeks. Generally, the trend started developing since mid-December 2018, due to the high export rates of the Ukrainian grain from the seaports in terms of its record production in the country, as well as the active interest of importers in corn purchases.

According to APK-Inform figures, since the beginning of January 2019 the bid prices of corn in CPT-port terms increased by 250-450 UAH/t — to 5250-5650 UAH/t, while only single traders announced the minimum prices from the range. In turn, in the reporting period the FOB offer prices with delivery in February increased by 8-10 USD/t, and mainly varied within 179-185 USD/t, with delivery in March — 182 USD/t and above, and with delivery in April — 185-190 USD/t.

It should be noted that in October-December of 2018/19 MY the EU countries became the main importers of Ukrainian corn, including Spain and the Netherlands. So, the region imported more than 5.5 mln tonnes of Ukrainian corn, against 2.1 mln tonnes in the same period last season. East Asia increased the import volumes, due to the growth of supplies to China, which purchased 824 thsd tonnes of the grain, against 726 thsd tonnes.

Also, in October-December of 2018/19 MY North Africa significantly increased the imports — from 594 thsd tonnes, to 686 thsd tonnes. At the same time, in the reporting region Egypt remained the key sales market for Ukrainian corn, which purchased nearly 300 thsd tonnes of the grain for the first 3 months of the season-2018/19. As a reminder, for the whole 2017/18 MY Egypt imported 2.4 mln tonnes of Ukrainian corn, and in 2016/17 MY — 3.4 mln tonnes, while China — 2.7 mln tonnes, and 1.5 mln tonnes, respectively.

According to the USDA, in 2018/19 MY the imports of corn to Egypt will total 9.7 mln tonnes, while China — 5 mln tonnes only, but the current situation with the carry-over stocks of the Chinese grain still remained quite unclear. At the same time, Ukraine somewhat increased the export rates of corn to Egypt, and reduced the supplies to China. Thus, in December 2018 Egypt imported more than 150 thsd tonnes of Ukrainian corn, against 116 thsd tonnes in November, and the December supplies to China totaled 264 thsd tonnes, against 511 thsd tonnes in November.

You can receive more detailed information about the trends of the grain market in the Black Sea region and prospects of the further cooperation with Egypt, within frames of the international conference Middle East Grains&Oils Congress, to be held on March 11-12, in Cairo, Egypt.

Organizing committee of the conference:

+38 (067) 634-26-05,

+38 (0562) 32-15-95 (multichannel)

Irina Ozip (ext. 115) — [email protected],

[email protected]