The global corn market is walking a tightrope between softening futures prices and physical tightness in origin markets, driven by weather swings, logistics, and erratic demand flows across importing regions.
While CBOT futures have softened on improving U.S. weather, the physical market tells a different story particularly in Brazil and Ukraine, where cash prices remain firm and premiums are supported by active buying and limited spot availability.
Supply-Side Snapshot
United States The U.S. corn crop is progressing well, with 73% rated good-to-excellent as of July 27, compared to 68% last year. Weather forecasts continue to support yield development. However, weak export demand and large old-crop carryout continue to pressure CBOT futures, with September down to around $153.1 per M/T and December below $162 per M/T levels not reflective of global physical tightness.
Brazil Safrinha harvest is now over 68% complete, with CONAB maintaining production at ~114 MT, but lineups are facing congestion at ports due to soybean spillover.
July corn exports are expected at 4.18 MT (ANEC), up from 3.55 Mt last year. Domestic premiums remain stable with FOB Santos offers at $235–240 per M/T, while CIF SE Asia sits around $255–260 per M/T.
Argentina Corn harvest is complete in most zones, and export offers remain available. However, domestic logistical challenges and the need to rotate to wheat planting are slowing forward offers. Argentine corn is quoted at $232–235 per M/T FOB Up River, facing stiff competition from Brazil and Ukraine.
Ukraine The corn crop is benefiting from timely July rains, improving soil moisture and crop ratings. Ukrainian FOB corn prices have increased to $235–240 per M/T for spot loading, driven by end-of-season short-covering. However, forward (Oct-Nov) prices remain capped at $206–210 per M/T FOB. August positions are tight, with logistics strained and traders finalizing July shipment schedules.
Demand-Side Dynamics
China Chinese buyers remain cautious. Domestic corn prices are still trading at RMB 2,400–2,450/ton, limiting imports unless deeply discounted. Ukraine is currently the most competitive origin, with CIF North China at $265–270 per M/T , while U.S. Gulf offers remain unviable due to high freight. China’s strategic use of state reserves is dampening import urgency, although a few late Q3 positions are being negotiated.
South Korea Feed buyers are back. FLC bought 132,000 M/T of corn for Sep-Oct at $234.05–233.8 per M/T C&F. Traders believe this was driven more by favorable pricing than a structural change in feed demand. Additional tenders are expected, but buyers remain flexible on origin Brazil and Ukraine both in play.
Vietnam, Indonesia, and (Philippines) These Southeast Asian buyers are opportunistic, snapping up Brazilian and Ukrainian cargoes based on price competitiveness. GrainFuel Nexus made a deal with vietnamese trader at $250–255 per M/T CIF for Sep-Oct.
Indonesia and the Philippines are targeting similar levels, with optional discharge terms.
Japan Japanese importers remain conservative. While there’s a return of some demand, import costs remain high, and feed compounders are limiting purchases. CIF Japan values are in the $260–265 per M/T range, mainly from Brazil and the U.S., though Ukrainian cargoes are gaining traction.
Egypt & North Africa GASC remains out of the corn market, relying on the private sector to fulfill needs. Importers have sourced small volumes from Ukraine at CIF Alexandria prices of $248–252 per M/T, limited by FX availability and slow poultry sector recovery. Any GASC return would likely focus on Ukrainian or Brazilian origins, depending on freight timing.
EU The European Commission cut corn production forecasts to 60.1 Mt, down from 64.6 Mt, citing persistent drought in France, Spain, and Italy. Import needs remain at 17–18 Mt, mainly from Ukraine and Brazil. However, the new U.S.-EU trade deal allowing "duty-free" U.S. corn could reshape origin preferences, with Western European buyers beginning to evaluate U.S. Gulf offers again.
Market Divergence: Paper vs. Physical
The disconnect between the soft futures market and firm cash basis is more evident than ever. Ukrainian and Brazilian spot premiums are being sustained by aggressive nearby demand and limited July availability.
Meanwhile, the U.S. market remains weighed down by a large old-crop carryout, strong crop prospects, and subdued Gulf interest due to high freight and weak competitiveness.
Short-Term Support, Structural Headwinds
The corn market faces a structural mismatch ; exporters are dealing with tight logistics and rising short-term premiums, while futures markets discount strong U.S. yields and lackluster macro demand.
GrainFuel Nexus expects continued firmness in spot physical prices across Ukraine, Brazil, and Argentina into August, with Southeast Asia and North Africa anchoring demand.
Futures prices may remain depressed unless export flows from the U.S. accelerate or unexpected weather events impact crop quality.
This divergence presents a unique tactical advantage for traders who can arbitrage basis spreads and optimize origin freight flexibility especially in the current freight-sensitive global market.
GrainFuel Nexus® | Expert Commodity Global Sourcing & Strategic Advisory© | All Rights Reserved
customer.service@grainfuel-nexus.com
Subscribe to our Strategic Reports - Essential Dive & Deep Dive Advisory