Analysis 29/06/2021

European market

In response to last week's recent downward price movement, some buyers are returning to the market. On the Euronext futures, prices for nearby maturities are now trading close to last April's levels. Egypt, through the GASC, concluded its wheat tender yesterday with the purchase of 180,000 t. This volume has been negotiated at 242.93 $/t FOB for shipments scheduled for late August/early September. Romania, offered more attractive prices in large volumes than Ukraine, Russia and France.

On the cereals, prices strengthened on Monday in line with North American prices. The current weather conditions are beneficial to spring crops, while winter barley harvests are starting slowly in this end of June. 

The Canadian canola for the 2021's crop is back to its highest levels. This upward movement has led rapeseed to continue its rebound. During the session on Euronext, the August 2021 delivery traded at more than 520 €/t, pulling in its wake all the following maturities. As a reminder, rapeseed/canola imports in Europe have increased over the current campaign. According to European Union figures, 6.30 Mt have been imported so far, a volume necessary to compensate for the lower European production and meet needs.

American market

Following a weekend of insufficient rainfall, prices rebounded yesterday in Chicago. Weather conditions are currently being closely monitored, particularly for spring crops. A heat wave has been announced for part of the Midwest.

The USDA also announced yesterday that spring wheat crops are in "good to excellent" condition for only 20% of the acreage, a drop of 7 points compared to last week. Maize crops are also down, with 64% of the area in "good to excellent" condition, down one point on the previous week. In soybean, the situation judged "good to excellent" is unchanged at 60%.

On the eve of the USDA's 2021 corn and soybean acreage release, US operators are also on alert for weather reports in South America. A cold snap could penalise maize crops, particularly in southern Brazil. This area has already been heavily impacted by dry conditions in recent months, reducing yield potential.

Black Sea market

Ukrainian wheat production is now close to exceeding 30 Mt, amid increased acreage and favourable weather conditions.

Ukraine's wheat production is estimated at 30.5 Mt by Agritel, which conducted a crop tour in the country from 14 to 18 June. It should be remembered that the 2020 production was 25.3 Mt.

Thus, for the 30th anniversary of its independence, Ukraine is on track to produce more than 30 Mt, a figure never achieved in the past.