Global feed market: Ukraine corn production decreased, Mexico postponed ban, corn rose

 

Chicago Board of Trade (CBOT) March 2022 corn futures closed at about $6.
6625/bu on Friday, up 2%
from a week ago.
The spot price for the January shipment of Meiwan No.
2 yellow corn was $7.
7675 per bushel, up 1.
3% from a week ago; The March 2023 corn futures on the EURONEXT exchange closed at around 296 euros/mt, up 4.
3%
from a week ago.
FOB quotations for Argentine corn on the upper river were $318/mt, up 1%
from a week ago.

 

International crude futures rose for the second straight week this week as Russia said it could cut crude production in response to a price cap
imposed by the G7 on Russian crude exports.
The West Texas Intermediate (WTI) crude (WTI) contract on the New York Mercantile Exchange (NYMEX) closed at $79.
56 a barrel, up 6.
9 percent
from a week ago.
Brent crude futures, the global benchmark, for February, were at $83.
92 a barrel, up 6.
2 percent
from a week ago.

 

The dollar index closed at 104.
01 on Friday, down 0.
62%
from a week ago.

 

Ukraine's corn production is only half that of last year

 

Ukraine's corn production in 2022/23 is expected to fall to 22-23 million mt, down from 41.
9 million mt the previous year, as the Russia-Ukraine conflict has led to a decline
in corn harvest acreage, Ukraine's agriculture minister Nikolai Sosky said this week.
Ukraine's Ministry of Agriculture had previously projected corn production at 25 million tons
.
Solsky said farmers face a lack of fuel and money, so they have to leave large areas of corn in their
fields.
These corn crops may be harvested next spring, but that means lower yields and worse quality
.
As of Dec.
15, farmers had harvested 18.
4 million tonnes of maize, or 70 percent
of the planned area.
Solsky also said that the large amount of corn that cannot be harvested may prevent farmers from continuing to grow corn next year, and that the fields may be converted to sunflower seeds
.
Ukraine, a major global corn exporter, has reduced its corn production, which means a decline
in export supplies to the international market.

 

Mexico's GM corn ban policy loosened

 

Mexican Agriculture Minister Viktor Villarobos said Tuesday that the United States is pleased
with Mexico's decision to delay the ban on genetically modified corn until 2025.
Mexico is one of the largest customers of U.
S
.
corn, and almost all corn in the U.
S.
is genetically modified.
Mexican President Andrés Manuel López Obrador signed a decree at the end of 2020 to stop imports of genetically modified corn and glyphosate
from 2024.
U.
S.
officials threatened in late November to take action on Mexico's GM corn ban under the USMCA Free Trade Agreement, arguing that the ban would cause significant economic damage to the U.
S.
corn industry and have a significant impact
on bilateral trade.
The Mexican Ministry of Economy then proposed to increase the transition period for the GM corn ban by one year, from the previous 2024 to 2025, and planned a comprehensive revision
of the presidential decree.
Mexico has submitted a document for discussion that could finalize the dispute
between the two sides in late January.

 

The EU lowered maize production by a further 1.
2 million mt

 

The European Commission lowered its EU corn production forecast in its monthly supply and demand data on December 22, with the latest forecast for EU corn production in 2022 at 52.
1 million mt, down from 53.
3 million mt forecast in November, 29% lower than last year and the lowest corn production
in 15 years.
Corn exports were revised down by 1 million tonnes, while imports remained unchanged at 23 million tonnes
.

 

U.
S.
corn exports remain sluggish

 

US 2022/23 corn net sales were 636,800 mt in the week ended Dec.
15, 2022, down from 958,900 mt a week earlier and at the lower end of
the market's expected range, according to the USDA's weekly export sales report.
U.
S.
corn sales totaled 20.
64 million mt year-to-date, down 47.
7% year-on-year and 48.
1%
year-on-year last week.
Among them, sales to China totaled 3.
73 million tons, down 69.
5% year-on-year and 69.
6%
year-on-year last week.

 

Brazil's corn production was revised upward

 

CONSULTANCY DATAGRO RAISED ITS FORECAST FOR 2022/23 BRAZIL'S CORN PRODUCTION TO 127.
92 MILLION MT, UP 6 MILLION MT FROM 120.
60 MILLION MT IN THE CURRENT YEAR, AS THE FORECAST FOR THE SECOND CROP MAIZE AREA WAS REVISED
UPWARDS.
NEW ANALYSIS FROM DATAGRO SHOWS THAT BRAZIL'S FIRST CORN CROP IN 2022/23 SHOULD DECLINE TO 4.
51 MILLION HECTARES, DOWN FROM 4.
61 MILLION HECTARES
IN 2021/22.
The first maize crop in the south-central region of the country is expected to be 2.
93 million hectares, down 6 percent
from 3.
12 million hectares in the previous year.
In the North and Northeast, the first corn crop is expected to be 1.
58 million hectares, up 6%
from 1.
49 million hectares in 2021/22.
The first corn production was revised to 25.
23 million mt, with 18.
12 million mt in south-central Brazil and 7.
11 million mt
in the north/northeast.
The latest production forecast is lower than the November estimate of 25.
97 million mt, but is essentially unchanged
from 25.
25 million mt in 2021/22.

 

Brazilian corn exports will double year-on-year to record levels

 

This year's bumper corn harvest in Brazil has provided a respite for the tight global corn market
.
Brazil's corn exports in 2022 will more than double year-on-year to a record 44 million mt
, according to ANEC, Brazil's national grain export group.
Brazilian corn shipments have accelerated
since low water levels on the Mississippi River hampered U.
S.
exports in October.
China, the world's largest corn importer, recently decided to start buying Brazilian corn to reduce its dependence on the United States, which also helps improve the outlook for Brazilian corn exports
.
In 2020/21, the U.
S.
accounted for about 70 percent of China's corn imports, but U.
S.
dominance will diminish
as hundreds of Brazilian facilities are approved to export corn to China.