Corn is becoming an increasingly sought-after commodity amid lower production forecasts by the EU's main producers: France, Romania and Italy. It is not surprising that the corn price for export to Europe is a pressing issue.
German agricultural analyst and market expert Olaf Zinke writes about this in an article on the portal Agrarheute.com.
“The price of corn is now higher than that of wheat. The EU Commission significantly lowered its harvest forecast last week. Heat and drought have hit corn fields in many European corn-producing regions. The market has responded: prices for corn on the futures market at the beginning of August are 352 euros per tonne and thus about 10 euros higher than for wheat,” the article reports.
New harvest corn (November) is currently trading on the Paris Stock Exchange at €323 per tonne. On the German market, grain corn recently cost €336/t for the old crop, while the asking price for the new crop is €340/t.
Unlike other grains, Europe depends on extensive imports of corn for animal feed. The EU Commission estimates European imports of corn from third countries for the new season at 16.5 million tons.
The EU corn harvest is now forecast at 65.8 million tonnes, up from 71.7 million tonnes in the June forecast and 72.7 million tonnes last year. The prerequisite for a sharp decline in yield is drought and heat in Europe. The European Mars Institute lowered its corn yield forecast by 8%.
Grain from Ukraine
Ukraine has long been selling grain to Europe and receiving significant income to the state budget. In 2023, the European market needed grain from Ukraine and due to drought caused by abnormally hot weather.
The main crops that Europe needs are corn, sunflower and soybean meal and soybeans. Despite the war, export volumes increased:
- Corn: from 8 million tons in 2021 to 11.32 million tons in 2022;
- Sunflower oil: from 1.96 million tons in 2022 to 2.05 tons in 2022;
- Sunflower meal: from 1.4 million tons to 1.58 million tons in 2023.
As we can see, the demand for Ukrainian food is significant. At the same time, Ukrainian officials understand that cooperation with their European neighbors is extremely important.
Ukrainian exports guarantee global food security
Although grain sales significantly supported Ukraine's economy, importers also benefited. For example, Poland, which last year exported more products to other countries than usual. In 2022, exports of meat and dairy products increased by 37%. All thanks to grain from Ukraine, which strengthened the competitiveness of Polish producers.
Logistics companies, traders and ports made money from the export of Ukrainian grain. Consequently, a large number of companies made significant profits and paid taxes to their states.
Ukrainian grain is a significant link in the chain of global food security. After all, it will not be possible to quickly replace and transport products to less wealthy countries.
Джерело: Мира Орановская 27.11.2023