European market
Few evolutions on cereals prices last Friday as the market activity is slowing down with the end of year celebrations’ proximity. The main concern for French operators remains to ensure the flow of goods toward ports or plants with the strikes of railway, lock operators or dockers. The corn lost some ground.
Traders are still trying to figure the consequences of the partial trade deal between USA and China with raising doubts about the actual volume of US agricultural products that will be bought in 2020 by China.
On the international stage, Japan bought 148 405 t of milling wheat sourced from USA, Canada and Australia. South Korea launched a soymeal tender in 60 000 t.
Soybean prices retreated on Friday due to profit takings after the rally observed in previous days. Canola prices were steadier.
Concerning the rules about no application zones in France, the minimum distances for surface cropping (cereals) will be of 5 meters and those for high-growing crops will be of 10 meters. The legislation will enter into force from the Jan 1.
The euro is weaker to start the week vs dollar and is dealing below 1.11. The crude oil remains steady above 60 $/b on the WTI.
American market
Quiet markets in Chicago last Friday as traders look reluctant to take position before the end of year break and uncertainties about the Sino American trade deal.
The soybean should be the main beneficiary of the deal as last year, China only bought 16.6 Mt of US origins vs 45 Mt that could be possibly imported in 2020 if the agreement is respected. The Brazilian crop from next spring will have to be taken into consideration in this context. If favorable climatic conditions persist, at least 122 Mt could be produced.
Last Friday, funds were net buyers in 6 000 lots of corn, 4 500 lots of soybean and they were net sellers in 4 000 lots of wheat.
Black Sea market
In the Black Sea region, cereals and oilseeds prices surged significantly during last week. The support from the Chicago’s market added to the end of year break have provoked a regain of interest from importers. Within one week, the 12.5% Russian wheat jumped by +4 $/t to reach 216 $/t FOB Novorossiysk. In Ukraine, the 11.5% wheat increased by +3 $/t last week to deal at 211 $/t FOB Odessa. The Ukrainian corn benefitted from the rise of the export taxes in Argentina and also from the Chicago‘s support or a busy demand. The corn was dealing at 174 $/t FOB Odessa by the end of last week, representing an increase of +5 $/t within one month.
Another key product of the Black Sea, the sunflower oil recorded also an increase. The positive trend observed on the palm oil is bringing a significant support to this product, its price jumped by +20 $/t in a week and by +40 $/t in a month to deal at 768 $/t FOB Odessa.