April 16, 2014

Ukraine and Russia's combined corn exports reach record high

Last season the biggest corn crops ever in the Black Sea region have allowed Ukraine and Russia to increase their global share of export markets, Oil World said.

From September through March, combined exports from Ukraine and Russia reached a record 19.4 million tonnes, accounting for 30% of total shipments from the world's top five exporters during that timeframe, the Hamburg-based researcher said in an e-mailed report. That's up from a 21% market share a year earlier. The Black Sea region's shipments expanded even amid increasing competition from a record US harvest, which the USDA pegs at 353.7 million tonnes.

Demand growth for the Black Sea region's corn mostly came from the EU, China and North African and Middle Eastern countries, as well as South Korea and Japan, Oil World said. US exports from September through March rose to 24.1 million tonnes, more than double a year earlier when crops were hurt by drought, Oil World data show. Shipments from Argentina and Brazil during that timeframe were below the prior year. The US is the world's top exporter, followed by Brazil, Ukraine, Argentina and Russia, according to the USDA's ranking.

Corn futures on the Chicago Board of Trade, the global benchmark, rallied about 20% this year amid concern that escalating tension between Ukraine and Russia would curb shipments from the region. The USDA expects production in both Ukraine and Russia to be a record in 2013-14, at 30.9 million tonnes and 11.64 million tonnes, respectively.

The Black Sea region's export pace is "considered as proof that the political and economic turmoil in Ukraine left inland logistics and export operations virtually untouched so far this season," Oil World said. "But further developments have to be watched closely as the situation remains largely unsettled."