The reports from the US Department of Agriculture and International Grains Council have not caused movements in wheat prices. What are the soy and corn quotes doing?
The quotation for wheat on the Matif in Paris fluctuates around €200 per tonne. However, there has been a small revival at the CBoT in Chicago. This is because Rosselkhoznadzor, the phytosanitary service in Russia, recently announced that it may close 30 ports in 2 important export areas (for up to 90 days).
By the way, lower wheat exports from Russia are good news for many European and American exporters. This is because they usually cannot compete against the supply of cheap Russian wheat; although the price of wheat from Russia has increased since mid-September.
NAFTA also has an influence
Another reason for the revival is the agreement that have reached the United States (US), Mexico and Canada. However, there are also factors that do not support a high price in the long term. An example of this is the fact that the USDA estimates yields to be slightly higher than previously thought. Exports are also lagging behind the estimate it had made earlier. It causes ending stocks to increase, which in turn puts pressure on prices.
In addition, the IGC reported higher global wheat production (+1 million tons), bringing the yield to 717 million tons. Reports are also coming from Russia that the harvest in Siberia will not be too bad, partly due to the good harvest conditions.
Good corn harvests
The corn quotations on the Matif in Paris show a downward trend. This while the quotations on the CBoT have been rising for some time. This is mainly because the harvest in the US has been delayed. In addition, corn exports are doing well. Although the yield in the Netherlands is significantly lower, the global harvest is turning out well, it reports IGC.
The IGC therefore increased the forecast for the global corn harvest by 10 million tons. In addition to a small plus for Ukraine, the US showed a significant plus of 6,1 million tons. Other countries in the European Union were also revised slightly upwards.
High demand for soy
Soybean prices on the CBoT rose from a 10-year low to $320 per tonne. This is partly due to the rain in the Midwest of the US. This delays the harvest and can cause damage to the crop.
The USDA report also showed that soy production figures are higher than last year. In addition, exports are actually less good than expected. This is partly because China has disappeared as a buyer. However, rising demand may support the price in the coming months.