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Since the start of the war, Ukrainian raw material exports have come to a halt. 15 million tons of corn are thus blocked. Which inevitably reshuffles the cards for the yellow grain trade.
The halt in grain exports since the war is a real blow to cattle feed manufacturers. The most penalized are the big buyers, China, Spain and the Netherlands. For Europe, Ukrainian maize represents 50% of imported volumes.
The tension is all the stronger as the corn is harvested late, in November, and as Ukraine still had about 15 million tonnes to export in mid-February according to the latest figures available from the UkrAgroConsult firm. That is much more than what is left to export wheat and barley crops.
The war benefits American corn
However, the cattle do not wait and must be fed every day. Buyers are therefore forced to look elsewhere and in particular to the United States. The American corn stock is estimated at 30 million tons and can respond to new demands. Spain has already taken steps to obtain supplies across the Atlantic. With a prerequisite: obtaining a derogation to import American GMO corn which was not authorized to enter European territory.
China, the leading buyer of corn from Ukraine, has large stocks – around 200 million tonnes, or 2/3 of world stocks – which protects it from any shortage. But it should not stop buying so far because it will have to reconstitute its reserves explains Gautier le Morgat, analyst at Agritel. It should therefore not be counted on to ease the pressure on prices.
In 15 days, prices have jumped by 40%
Because those who buy today, in an emergency, have to face prices which have soared: in two weeks they have increased by more than 40%, i.e. an additional cost of around 100 euros for a ton of corn arriving in Bordeaux. in France. Manufacturers who will not be able to pay as much will have to turn to wheat in particular, which will only fuel the rise in prices on a market that is also already tight.
The unknown is how long the Ukrainian corn will be blocked, and also what the next harvest will look like. Sowing should start by early April. Will farmers have enough seed, “ probably not fears the Agritel expert, will they have enough fuel to run their tractor, enough phytosanitary products? Not to mention the security context which risks reducing the workforce in the Ukrainian countryside.
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