European market

Wheat prices increased again yesterday in a context of tight physical supplies in the ports. The railway services remain disrupted in France by the strikes.

The market of feed barley is still dull and physical premiums are falling down. The good orientation of the wheat is not fully being passed on other cereals.

On the international stage, Egypt launched a wheat tender for today. Shipments are planned for the period 1-10 March. The competition will be stiff once again between Black Sea and French origins. We can note as well the purchase of 137 000 t of corn, optional origins, by South Korea.

In oilseeds, political tensions between India and Malaysia are weakening palm prices. Malaysian imports are not officially banned in India, but the authorities have suggested local operators to stop their purchases. On the back of that, prices in Kuala Lumpur declined, pushing the rapeseed to lose ground as well. The crude oil is retreating due to a relative relaxation in the tensions between USA and Iran.

In Europe, temperatures remain abnormally high. Rainfall is heterogeneous on the continent: excessive in the west and in deficit in the east.

American market

Markets were steady yesterday before the signature of the partial trade agreement between the US and China. Will this event fall short of expectations? The probability is strong…

Soybean imports by China have resumed; the hog herd has been strongly cut and is currently building up again.

Wheat prices declined slightly, contrasting with the trend on Euronext. In its last report, the USDA said that wheat acreage in the US could be larger than anticipated by the analysts.

Corn prices are firm; financial funds remain short and could buy back a part of their positions at any time.

Yesterday, funds were net buyers in 12 000 lots of corn. They were net sellers in 3 500 lots of soybean and 3 000 lots of wheat.

Black Sea market

The high pace of exports observed in Ukraine is well supported by the rail logistics. The efficiency has ben improved significantly compared to previous years. During December, delays in the distribution of wagons or at the reception of freight have been cut. This enhancement should be on a long-term basis. Indeed, in 2019, the state railway operator managed to carry 35.3 Mt of cereals for export, representing about 30% more than in 2018.

This improvement is explained by:

• The increase of the number of private wagons aimed to carry cereals
• The implementation of a policy favouring the stations able to load 44 wagons in less than 48 hours
• A quicker rhythm of rotations between lands and ports

The absence of winter conditions has also played a role in the improved efficiency of the system in this period of high traffic.