Week 22: grain prices drop slightly

The drought in the Black Sea region remains an important price-supporting factor. Ukraine's winter wheat harvest is estimated by sources at 24 million tons, up from 25,4 million tons in 2017, while Russia's harvest is estimated at around 58 million tons, compared to 64,3 million tons last year.

The drought in Australia is also worrying analysts, although rain is now expected there. On the CBoT in Chicago, the wheat price also shows a small decline. This has to do with expected rainfall in the American Plains.

Good condition European wheat
The condition of the grains in Europe is generally excellent. In France, the condition of soft wheat is estimated at 80% excellent. The European Commission estimates the common wheat harvest at 140,2 million tonnes at the end of May, compared to 141,8 million tonnes in 2017.

Yet wheat quotations are relatively high, partly due to disappointing harvest expectations. This also affected the regional fairs this week. For example, the grain exchange in Groningen increased the quotation for wheat by €4 per tonne. Middenmeer also recorded €3 higher. Regional wheat prices are therefore around €175 per tonne.

(Text continues below the chart)The wheat quotation on the Matif in Paris fell slightly this week.

Decrease in corn supplies
Corn prices show a small decline, after a strong increase. This is due to the good conditions of the corn in the United States. The International Grains Council (IGC) expects a global corn harvest of 1.045,9 million tons (with consumption of 1.097,9 million tons). It is therefore expected that the theoretical world stock will decrease by 43,0 million tons to 256,4 million tons.

Soybean prices remained stable despite renewed threats of a trade war between the United States and China. Brazil continues to invest in soybean transport. This is also necessary, because Brazilian exports of soy and corn increased by 2010% between 2017 and 145, to 97 million tons.