Source: Ukragroconsult (Ukraine)
The dry weather in the Black Sea region is reducing the potential for the maize harvest this season, prompting analysts to adjust production forecasts for the EU and Ukraine.
The European Commission lowered its forecast for the EU maize harvest in the 2024/25 marketing year by 11% to 60 million tons (2% above the 5-year average), including for Romania by 1.1 to 9.5 million tons (-10% compared to the 2023/24 marketing year) and for Bulgaria by 0.4 to 2.6 million tons (+8%).
Strategie Grains lowered its forecast for the maize harvest in the EU by 2 million tons to 60 million tons, which corresponds to a decline of 4.5% compared to the 2023/24 marketing year.
The USDA’s FAS spokesperson lowered its forecast for the EU corn crop from 64 million tons to 59.8 million tons (the USDA estimated 64 million tons in June).
Markets have yet to react to forecasts for lower corn production in the EU as a higher proportion of feed wheat depresses prices, especially given forecasts for good harvests in the US and Brazil.
Corn futures for November on the Paris exchange fell by 0.6% this week to EUR 204.25/tonne or USD 223/tonne (-1.6% this month, -12% this year).
The Ukrainian Grain Association lowered its forecast for the 2024 corn harvest by 2.1 to 23.4 million tons (-21% year-on-year) and ASAP Agri lowered its forecast by 5.2 to 24.1 million tons, while the USDA estimated it at 27.7 million tons in July. The USDA could therefore adjust its estimates in August.
In Ukraine, purchase prices for corn for delivery to Black Sea ports remain at USD 180-185/ton (SRT) in October/November, but their increase is being curbed by a decline in export prices for feed wheat to USD 178-180/ton (CPT).
According to the State Customs Service, Ukraine exported 1.74 million tons of corn in the 2024/25 marketing year (as of 7 August) (0.9 million tons in the same period last year).
The weather in the US is favourable for the harvest, so analysts have raised their harvest forecasts to 385-386 million tons, although the USDA forecast 383.6 million tons in July.
December Chicago corn futures fell below the psychological USD 4/bushel or USD 156.3/ton mark (-2.8% for the month, -30% for the year) and will only be supported by an adjustment to the world balance sheet in the USDA’s August report.
US corn exports for the 2023/24 marketing year were 36% higher than the previous season at 47.88 million tons (compared to the USDA forecast of 47.7 million tons) and are on track to reach 50 million tons by the end of August.
Brazil and Argentina have completed the corn harvest, so the new USDA report could adjust the production data.