Corn prices soared to the highest in nearly 10 years this week, as global supplies face increased crop shortages in Ukraine amid Russia’s military conflict, while poor weather in North America threatens to derail the upcoming planting season.
US corn futures jumped to over $8 per bushel on Monday, as Russia’s military operation in Ukraine showed no signs of abating after armed forces stormed Mariupol over the weekend. Ukraine, which is responsible for approximately 16% of global corn exports, faces increased threats of trade disruptions, prompting increased demand from alternative sources, such as US agricultural exports.
However, an unexpected fertilizer supply shock and subsequent jump in prices threatens to disrupt the current planting season in the US, as cash-strapped producers are forced to plant more soybeans in lieu of corn since the former requires less nutrients. To make matters worse, unseasonably cool weather across the Canadian prairies has already delayed the planting season by more than one week.
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“We are not seeing a lot of warm temperatures and soil temperatures are not coming up as fast as they should. This will be a problem in May, if this trend continues,” warned WXrisk owner David Tolleris, as cited by Bloomberg.
Information for this briefing was found via Bloomberg and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
