European market
US markets are putting pressure on straw cereals, causing a fall in wheat prices on Euronext, with prices returning to their lowest levels for a month, around 180 €/t. Upward revisions in Russian production are among the factors weighing on prices. This is offsetting the poor European harvest that is sharply down compared to last year. The French harvest is estimated by Agritel at only 29.2 million tonnes, and the Romanian crop is disastrous, estimated at only 5.5 million tonnes by the Romanian Ministry of Agriculture. Traders are currently ignoring these factors.
Egypt is taking advantage of this downturn to launch a new wheat tender. Considering the current competitiveness of the wheat sourced from Black Sea, it is highly likely to see these origins retained. The high level of the Eurodollar remains a penalizing factor for France. The parity is posted this morning at 1.1820.
On the international market, Thailand has also launched a tender in 192 600 t of optional origins’ feed wheat and 107 700 t of feed barley sourced from Australia. Jordan is seeking 120 000 t of wheat.
The persistent water deficit in France continues to support corn prices, despite prospects of abundant harvests in Ukraine and in the US regardless the drop in acreage.
The rapeseed still benefits from the firmness of the palm and the rise in RME prices linked to a change in legislation about the Fame-10 incorporation.
American market
Prices for all commodities fell sharply in Chicago yesterday as good weather conditions are favouring soybean and corn crops. The US wheat, for its part, remains under pressure due to a disappointing export activity.
In soybean, the crop rating posted on Monday (73% as good to excellent) suggests a potential record harvest. The corn also benefits from recent days’ rainfall at the crucial stage of flowering.
Corn and soybean prices are testing new lows on the CBOT.
Yesterday, funds were net sellers in 32,500 lots of corn, 12,000 lots of soybeans and 10,500 lots of wheat.
Black Sea market
The Ukrainian association of grain exporters has evoked an all-crops production figure at 100 Mt and a record export volume of 61Mt.
The upward revision of the production estimate is due to an improved outlook for barley and corn, according to the association. The barley production has been revised upward from 7.6 Mt to 8.2 Mt for an export potential of 4.2 Mt. The corn production is expected to reach a record high at 38.9 Mt, raising an export potential of 33 Mt. The wheat production is left unchanged at 26.8Mt with an export potential of 18Mt.