Ukraine boosts corn sales to China at expense of traditional markets

Ukraine’s corn exports to China surged through the early part of the 2017/18 marketing year, with official data showing a drop-off in Ukraine’s traditional markets as it offloads this year’s crop to east Asia, Agricensus analysis has shown.

Customs data for the July-November period of 2017 – the most recent available – show Ukraine exported 538,098 mt of corn to China, versus a mere 1,455 mt at the same point in the 2016/17 marketing year.

It marks the best start to a marketing year since 2014/15, when exports over the same period totalled 706,695 mt.

While November is the most recent customs data available, Asia-based market sources put the total volume exported through to early 2018 at between 800,000 mt and one million mt, as exports have continued through December and early January.

However, when looked at on an annualised month-versus-month basis, corn exports for 2017 are lagging well behind that of 2016.

From January through to November, total exports reached 1.8 million mt, versus 2.4 million mt over the same time frame of 2016, and 3.1 million mt in 2015 according to the data.

China has been importing corn despite pledging to reign in its own production and cut its mammoth stocks – with some putting China’s current corn stocks above 250 million mt.

Market sources have seen China’s appetite providing support to corn prices globally, with the country turning to Ukraine as US corn has a higher moisture content and is GMO.

“The more corn that China can take out of the Black Sea, the less you have for everybody else, so it provides a chance for prices to rise,” one market source said.

While Ukraine’s exports have surged through the final few months of 2017, sales to other destinations have slumped, as South American suppliers eat into traditional markets on Ukraine’s doorstep.

Exports to Iran have dropped off completely, falling from 847,644 mt to zero over the five-month period.

Meanwhile, sales to Egypt have fallen 77% to 156,742 mt, those to Tunisia are down 35% at 155,422 mt, and sales to Portugal are 22% lower at 53,482 mt.