European market

The day was strange yesterday with a sharp rebound in prices, especially in cereals. There are a lot of difficulties in supplying factories or mills, leading processers to seek to obtain supplies as quickly as possible. Indeed, given the lack of manpower, the logistics are insufficient to ensure an optimal flow of goods. In this context, the markets recorded a clear increase for cereals, with the exception of malting barley, a sector particularly affected by the drop in consumption.

Another element of support on the European markets yesterday was the fall of the euro which was displayed below 1.07 during the day. This morning the euro increases a little to 1.0750 against the dollar. The same situation is in crude oil with a rebound this morning to 26.80 $/barrel in New York. These up movements seem technical at the moment and are not yet signs of the trend reversal or the end of the crisis. Caution is therefore required.

On the international scene, China bought 120,000 t of wheat and 120,000 t of soybeans from the USA, proving its return to the markets. The coronavirus epidemic appears to be stabilizing in China, while it is progressing in Europe and is only in its early stages across the Atlantic. South Korea bought 60,000 t of corn and 136,000 t of wheat from the USA. Saudi Arabia has launched a call for tenders for 720,000 t of feed barley, including 480,000 t from the Black Sea.

On the international scene, there is, therefore, a strong demand, which supports prices. Indeed, China is looking for new wheat offers. France could, therefore, benefit from Chinese demand.

Rapeseed prices increased yesterday thanks to the rebound in soybean and crude oil prices. The latter two are still up slightly this morning.

American market

The net rebound of prices was registered yesterday in Chicago, for all products. Wheat jumped by + 26 cents per bushel, corn by + 9 cents and soybeans by + 15 cents on average. The main reason is the return to purchases from China, as well as panic purchases in a context of difficulties in supplying factories.

Wheat has benefited from overconsumption of basic products linked to the health crisis. Corn remains fragile due to the difficulties encountered by the ethanol sector. The soybeans welcome the return of China to purchases, even if the volume was only 120,000 t yesterday.

The funds were net buyers yesterday for 21,000 lots of corn, for 13,000 lots of soybeans and for 14,000 lots of wheat.

Black Sea market

The devaluations of the ruble and the hryvna by -30 and -15% respectively since the start of the year largely help to limit the fall in agricultural commodities in these two domestic markets. Thus, the price of Russian wheat for Novorossiysk delivery reached its highest level of the season with 13,600 RUB/t. In Ukraine, the local price of a ton of corn has peaked since the start of the season, trading at 4,500 UAH/t in the central zone.

Thus, these devaluations ensure a certain seller interest among Black Sea producers despite the drop in commodity prices on the international scene.