Trump’s Customs War Could Help Ukrainian Corn Exporters
7 April 11:49
Demand for Ukrainian corn may increase significantly if countries under US sanctions impose duties on US corn. This was reported by GrainTrade, according to "Komersant Ukrainian".
As you know, almost all major trading partners of the United States, including buyers of American agricultural products, have been subject to US customs sanctions. Thus, the duty for goods from South Korea is 25%, from China – 54%, from Japan – 24%, from the EU – 20%. Mexico and Canada are facing 25% duties announced in early March.
What is and can be the answer
Of the main crops exported by the United States, soybeans and corn are at the epicenter of trade wars. Now Mexico, Japan, China, the EU, and South Korea, which have been buying tens of millions of tons of corn from the US, are preparing for counter-sanctions. And not just preparing.
On March 10, China has already introduced countermeasures in the form of 15% duty on corn and 10% on soybeans from the US, GrainTrade notes. The EU is considering imposing a duty on soybeans and a 25% duty on corn, as well as stricter environmental requirements that will limit imports of products grown with chemicals banned in the EU.
What will happen to the corn market?
Brazil will get new prospects for exporting its agricultural products amid this customs war. Its strong ties with China, the EU, and Southeast Asia, competitive prices, and forecasts of a good harvest in the 2024/25 marketing year will allow it to capture some of the buyers of American agricultural products.
Argentina is also strengthening its position due to high harvests, favorable exchange rate and active export strategy, especially in Asia and the Middle East.
What are the prospects for Ukrainian producers?
If the major importers impose duties on US corn, the demand for Ukrainian corn will increase significantly, as it has a competitive price, well-established supply logistics and strong ties with the EU and Asia.
Brazil will become the main supplier of corn on the global market, but it will not be able to meet the demand of all buyers who will refuse to buy American grain, which will open up new prospects for Ukraine.
How much and where does Ukraine export corn?
In January-February 2025, corn was the most exported commodity from Ukraine.
According to the State Customs Service, since the beginning of the year, Ukraine has exported 4.7 million tons of this grain crop, worth $982 million.
It has become a key export commodity, accounting for 26.5% of agricultural exports and 16% of Ukraine’s total exports.
Ukraine exported the largest volumes of corn to the following countries:
Spain – 933 thousand tons,
Italy – 725 thousand tons,
Turkey – 639 thousand tons,
Egypt – 593 thousand tons,
The Netherlands – 514 thousand tons.
In 2024, the export volumes of corn reached 29.6 mln tonnes worth $5.1 bln.
What about the corn forecasts for this year
The U.S. Department of Agriculture (USDA) has updated the forecast of the balance of major crops for the 2024/2025 marketing year, where the production of Ukrainian corn remained unchanged, but the export volumes decreased. This was reported by the Ukrainian Agribusiness Club.
According to the updated forecasts, in 2024/2025 marketing year the corn production in Ukraine remains at 26.5 mln tonnes, respectively. As for exports, the forecast for corn has been reduced by 1 million tons to 22 million tons.
According to the updated forecasts for the global corn market in 2024/25 marketing year, all indicators are expected to decline: production, consumption, trade volumes and ending stocks.
The forecasted world corn production is expected to decrease by 1.9 mln tons to 1212.5 mln tons mainly due to Argentina and Brazil. Production in Argentina will decline due to lower yields, as heat and dryness during January and early February reduce the prospects for early planting corn in key central growing regions. For Brazil, the corn production forecast has been lowered due to slow planting of second crop corn in the central and western regions, which reduces yield prospects.
The main changes in the global corn trade for 2024/25 marketing year include, in particular, a decrease in the forecasted corn exports from Brazil – by 1 million tons to 46 million tons, and from Ukraine – by 1 million tons to 22 million tons.
