European market
Few evolutions on markets last Friday, traders are cautious before the publication of the USDA report tomorrow. Uncertainties remain high on the coronavirus impact for goods flows. The economic activity in China is strongly hit and this could damage the global growth in coming months.
The euro is losing ground versus dollar to deal around 1.0950. The green back has been boosted by positive US economic figures. The crude oil continues to decline with an offer currently exceeding the demand.
The French wheat is still showing a good level of competitiveness on the international stage especially versus Black Sea origins. Following a decent figure of export toward third countries in December (1.2 Mt), 2 or 3 cargoes have been sold last week to China.
Algeria launched a wheat tender. Turkey is seeking 250 000 t of soft wheat and 50 000 t of durum wheat.
Rapeseed prices are struggling to recover despite of tight fundamentals suggesting a significant deficit for the next European campaign.
American market
US markets were in little evolution pending the USDA report tomorrow. This report will not reflect the trade deal between USA and China in order not to distort the analysis on uncertain good flows between the two countries.
Wheat and corn prices in Chicago are currently testing the support areas. This is triggering some technical purchases especially from the funds. Now, real signs of a prick up in the export activity will be needed to hamper a breach of support areas.
Friday, funds were net buyers in 20 000 lots of corn and 3 500 lots of wheat. They were neutral in soybean.
Soybean harvests in Brazil are currently achieved up to 15.7% vs 27.3 % last year.
Black Sea market
For the second week in a row cereals’ prices have declined in the Black Sea area for both the current and next marketing year. In FOB Novorossiysk, the Russian wheat gave up about 5 $/t during last seven days to deal at 223 $/t. This is 20 $/t above prices for the next marketing year. The Ukrainian corn retreated by -4 $/t to deal at 182 $/t in FOB basis. Corn prices for the next season are still evolving above the current one.
From the start of the coronavirus outbreak, the demand for Black Sea origins is declining, especially for longer deliveries like April or May.