Inside Grains & Commodities
Grain prices fall sharply despite drought
The grain markets in Europe are dominated by drought and the harvest has even started early in several areas. On this basis, the European Commission reduced the yields for the various grain crops. What does this do to the listings?
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Choose the subscription that suits youThe estimated lower yields in the European Union (EU) have little effect on the CBoT listing in Chicago. In the United States (US), the spring wheat harvest appears to be very good. The wheat price showed a slight increase again on Thursday, June 21, which is believed to be due to the ongoing drought in Russia.
The wheat quotation on the Matif in Paris fell sharply last week. In week 24, €183 per tonne was still recorded, this week (week 25) the low point was €171,75. There is now a sign of recovery and the price is €174 per tonne. This could be because of it MARS report. The hectare yields of wheat are declining by 2,4%, as a result of drought in many European countries.
Declines on regional stock markets
The regional stock exchanges also show a decline in wheat prices. The Middenmeer stock exchange listing (for wheat) fell by €2 to €172. The quotation for the new harvest even fell by €5 to €160. The soybean price is also in free fall and is now at the lowest level in 2 years.
The decline is because US President Donald Trump announced that he wants to impose new import tariffs on Chinese products. This would involve $200 billion worth of Chinese goods, which would be subject to a 10% import tariff. This is because China imposes a tax soybean has set.
Strikes over
De staking of transporters in Brazil is now over, but the consequences are becoming increasingly visible. Brazil's National Agricultural Confederation (CNA) expects a delay in exports (soybeans and soymeal) of 6,8 million tons, due to disagreements between grain traders and transport companies.
Confidence in US corn crops is putting pressure on prices on the CBoT. Although the USDA (US Department of Agriculture) estimated that global corn supplies would be lower, the price continued to decline. At the Matif in Paris the price fell to €162 per tonne. Now the Matif is showing some signs of recovery. This was probably influenced by the MARS report, in which the corn harvest was reduced by almost 4%.
This reduction is partly due to the drought in the EU (such as Germany). The agricultural organizations in the country are talking about the smallest harvest in 20 years. Lower corn yields are also expected in Romania, Belgium and Poland.
The corn quotation on the Matif in Paris is showing a small recovery.