Super rally wheat is heading towards 220 euros per tonne

The wheat quotation on the Matif in Paris closed on Tuesday, August 7, at €216,25 per tonne. The price increase continued on Wednesday morning, August 8, adding another €1. On the CBoT the quotation closed slightly lower on Tuesday, August 7, but is still trading at the high level of more than $211 per tonne.

Russian yield is low
It is expected that the Russian harvest will be lower than last season. This is because the yields were extremely high last season. It now appears that the Russian wheat harvest is estimated at approximately 67 million tons, which is 18 million tons less than last season. About 12% of the wheat is of poor quality, partly due to rain during the harvest.

(Text continues below the chart)Both the quotations in Europe and the United States are rising to great heights.

The fact that the wheat harvest is lower in almost all major production areas also has consequences for the world wheat harvest forecast. This was recently estimated by the International Grains Council (IGC) at 721 million tons, a minus of 37 million tons (or a decrease of 5%).

A reduction of 10,5 million tons is expected from the countries in the European Union (EU), from Russia it is 18 million tons and China is expected to have 7 million tons less. Although it must be mentioned that the data from China is still very unclear.

The situation in Ukraine
Revenues in Ukraine are also estimated to be lower. The harvest backlog is caused by bad weather, which is expected to result in a harvest of 23 million tons. That is 4 million tons less than last year. This would also mean that 2,5 million tons less wheat would be available for export.

Expectations for the United States (US) are somewhat more positive. The IGC estimates that the harvest will be 3,7 million tons higher than previously forecast. This means that the wheat harvest could reach 51 million tons. The U.S. winter wheat harvest is 90% complete and the spring wheat harvest is currently 13% complete. These percentages are comparable to last year in the same period.

US spring wheat conditions fell from 78% to 74% (good to excellent) last week. It will remain unfavorably warm and dry in these regions in the coming days.

French harvest 
The French soft wheat harvest is officially estimated at 35,1 million tons, with a yield of 7,11 tons per hectare. In 2017, the harvest amounted to 36,6 million tons with a yield of 7,37 tons.