Inside: Grains & Raw Material
Grain prices falling after rain
The wheat and soybean quotes are sharply lower on the CBoT in Chicago (United States). The reason for this is that rain has fallen in the South American country of Argentina and in the American state of Kansas. Will this have a lasting impact on market prices?
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Choose the subscription that suits youThe price of wheat fell sharply at the beginning of this week. This is because parts of the southern Plains have received rain and snow. The rain caused funds to sell their contracts and prices fell sharply.
Too little precipitation
The amount of rain that has fallen is not nearly enough to repair the damage to the crops. At least, that is the expectation. The United States Department of Agriculture (USDA) announced on Monday, March 19, that 55% of the wheat crop in Kansas is in poor to very poor condition.
The crop is also in poor condition in other important wheat production areas. The weekly export figure for American wheat was high (443.000 tons), which still supports the price somewhat.
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The wheat quotation on the CBoT in Chicago fell sharply at the beginning of this week.
Soybean market
The soybean market is also showing a downward trend due to rainfall in Argentina. However, mainly dry weather is expected again in the Argentine soybean areas over the next 10 days, which means that an improvement in the crops does not seem logical. Soybean prices closed yesterday (Tuesday, March 20) at $377 per tonne.
The fact that American soybean exports were disappointing (491.000 tons) caused the price to fall even further. This disappointing export was because Brazil still had soybeans left over from last year. This is advantageous, because these soy beans contain more protein and are also competitively priced.
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Soybean prices fell on Monday, March 19, due to rain in Argentina.
China-US tensions
The soybean market hardly responded to reports in the Chinese media stating that the Chinese government will impose import duties on soybeans from the United States. The USDA expects China to have record imports in the coming season and analysts also doubt whether Brazil has enough supplies to supply China.
Prices for wheat also fell in Europe at the beginning of this week. This after one strong rise in week 11. The quotation closed on Tuesday, March 20 at €162,5 per tonne. The frost did not cause major damage in the European crops, so the supply has not been reduced.
The wheat quotations on the Matif in Paris show a mixed picture.