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Corn: fake news about export stop in Ukraine

March 23, 2020 3:39 PM, Der AUDITOR
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PARIS. The EU corn market is moving upwards as the wheat market continues to put pressure on it. Feed mills increase stocks to ensure supply availability. Ukraine does not restrict agricultural exports under any circumstances. In the USA, China's wheat and corn purchases were seen as a comeback to its trade relations. The low price of crude oil is putting such a strain on the US ethanol market that ethanol plants have to close.

Prices in the animal feed sector have also risen noticeably. Similar to the milling industry, the feed mills have also increased their supplies in order to avoid possible restrictions in delivery traffic. After the automobile industry cut back its production, freight traffic on the motorways decreased. However, the haulage companies are operating at much lower capacity because truck drivers from the eastern EU avoid quarantines and are reluctant to risk contagion. In contrast to the flour and pasta business, there have not yet been any supply bottlenecks for grain maize. The price increase for has different reasons: firstly, the euro exchange rate has fallen below 1.07 USD/EUR, which makes Ukrainian and Brazilian imported corn more expensive, if it is available at all from South America due to strikes by warehouse workers and truck drivers. In the Ukraine, corn exports increased to 835,000 mt last week, with two ships being loaded into China. Rumors that Ukraine wants to restrict its agricultural exports due to quarantine and export restrictions on staple foods were not confirmed. "Under no circumstances will such a ban be imposed on poultry meat, cereals, vegetable oil and other goods in which Ukraine is the world leader in world exports," said Taras Kachka, Ukraine's Deputy Minister of Economic Development, Trade and Agriculture. In South Oldenburg, the concentrated feed industry last bought feed wheat for 199 EUR per metric tonne DDP, corn cost around 192 EUR per metric tonne.

Corn, daily price development

Parity

EUR/mt

Diff. EUR/mt

Bordeaux, FOB

163.00

3.00

La Pallice, FOB

162.00

3.00

Netherlands, CIF

186.00

2.00

Oldenburg, DDP

192.00

2.00

Brake, FOT

188.00

5.00

Lower Rhine Region, DDP

188.00

5.00

Upper Rhine Region, FOB

182.00

0.00

Ukraine, FOB

-

-

Trade sources

Crude oil drops to lowest level in 17 years
China bought 340,000 metric tonnes of HRW wheat, a good 756,000 metric tonnes corn and 110,000 metric tonnes soybeans from the USA, which was considered as a comeback of trade relations with fulfillment of the Phase 1 deal. The fact that the US Senate was unable to agree on a rescue package to alleviate the consequences of the pandemic had a dampening effect. The crude oil market continued to fall, with Brent at USD 26.3 per barrel and WTI at USD 22.9 per barrel in the morning, down another USD 3.3 per barrel. The market was burdened by the news that Russia will continue to expand its crude oil production volumes. Moscow is aiming to give the US fracking industry a severe blow, thereby reducing the supply of crude oil on the world market. Crude oil prices reached the lowest level in 17 years. Declining ethanol production in the USA is causing DDGS (Dried Distillers Grains with Solubles) inventories to shrink sharply, driving their prices worldwide. More and more ethanol plants have to close down due to high losses.

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