World Grain - December 2024 - 14

GRAINMARKET REVIEW
COARSE
GRAINS
Corn firms on solid export demand
by Chris Lyddon
Solid export demand and a slightly bullish WASDE report
meant a firmer maize (corn) market in November, taking
sorghum up with it. A mixed picture left barley steady overall,
while oats and rye were down. Geopolitical factors, notably
the war in Ukraine, remain an issue for the market.
The International Grains Council (IGC), in its monthly
Grain Market Report released on Nov. 22, said maize prices
had risen by 3% in five weeks, " buoyed primarily by firmer
US and South American fob values. "
" US maize futures rose by 6% overall, mainly on solid
international demand, including from Mexico, " the IGC
said. " Larger-than-anticipated cuts to US yield and production
estimates in the November WASDE (USDA World Agricultural
Supply and Demand Estimates report, released
Nov. 8) were also mildly bullish.
" However, the uptrend was contained at times by seasonal
harvest pressure and overspill from outside markets, including
crude oil and currencies. Nearby fob values in Brazil
(Paranagua) worked higher, drawing continued support
from underlying solid demand from local ethanol processors.
However, some weakening was evident more recently,
as traders evaluated a more favorable planting outlook for
the main safrinha crop. "
Markets in Argentina were " nominal at times amid limited
fresh trading interest, " the IGC said, but " fob prices
remained competitive, " while " in contrast to other origin
markets, spot quotations in Ukraine eased on slightly softer
export interest. "
The US Grains Council in its Nov. 21 Market Perspectives
report pointed to launches by Ukraine of westernmade
long-range missiles at targets in Russia, which triggered
a rally in CBOT maize.
The IGC noted little change in barley prices, with " declines
in the EU and Australia broadly balanced by gains in
the Black Sea region. " French dollar-denominated export
prices eased, " mostly reflecting muted buying interest, including
from China, " while " values in Russia rose, likely
on slow producer selling. "
Despite a drop in basis levels, US Gulf sorghum prices
rose on the back of firmer maize (corn) futures, the IGC
added.
" Gains in export premiums and strength in Chicago lifted
14
Monthly corn prices
(in US dollars per tonne)
100
150
200
50
No. 2, yellow FOB, US gulf ports Gulf ports
export quotations in Argentina, " it said, noting that " values
in Australia also firmed. "
" The US oats spot (December) futures contract declined
by 9% month on month, mainly on losses in wheat, " the
IGC said. " Despite some seasonal pressure, cash values
in Australia (Kwinana) rose, " while " quotations in the EU
(Finland) dropped on subdued buying interest. "
" Despite tight availabilities, physical rye values in the
EU (Germany) declined, likely on subdued demand from
the domestic milling industry, " the IGC said. " Nominal
prices in Russia rose. "
The European Confederation of Maize Production
(CEPM) has warned of the effect of the trade deal being negotiated
between the EU and the South American Mercosur
group of countries. Pointing out that 25% of EU maize consumption
is imported, CEPM said that if the deal is signed,
" this ratio is expected to rise, with one in three tonnes of
maize being imported. "
" The EU in 2032 could lose 600,000 hectares of maizesown
land, while Brazil would gain 3.8 million, " the
France-based group said. " The decline would also be significant
for ethanol, with the draft agreement granting Mercosur
an export quota of 650,000 tonnes, equivalent to a
loss of 235,000 hectares for the European Union. "
CEPM said that for it to accept the deal, measures would
be needed to ensure that maize imported from Mercosur
had not been treated with substances banned in the EU. It
said it also wants the Cerrado savannah zones added to the
list of ecosystems covered by the European regulation on
combating imported deforestation.
Chris Lyddon is World Grain's European correspondent.
He may be contacted at: cajlyddon@gmail.com
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December 2024 / World Grain / World-Grain.com
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Source: World Bank
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World Grain - December 2024

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