The wheat quotation on the Matif in Paris has risen sharply in recent days. This is how the European wheat quotation is reacting to the futures markets in the United States. What is going on?
The wheat quotation on the Matif has risen from €170 per tonne to €182 per tonne since mid-May (May 27). On the CBoT in Chicago, the price for wheat rose even faster: from $154 per tonne to almost $180 per tonne. A price rally is also visible in corn and soybeans. The corn quotation on the CBoT even reached the highest level in 3 years.
Extremely wet
The main cause for these movements is the bad weather in the United States, especially in the Corn Belt it is very wet. There are therefore not only concerns about the thousands of hectares that cannot be sown. The abundant rainfall can also cause lower yields and quality problems in plots that have already been sown.
The rally in the grain market is supported by the weather forecasts for the coming week. It would remain wet. According to the latest estimate, maize sowing is about 30% behind previous years, meaning that about half has now been sown. It is expected that 2 million hectares of maize cannot be sown.
Lower yields in China?
China also plays a role in the price rally. For example, the country has serious problems with caterpillars of a moth: the armyworm. According to the Chinese Ministry of Agriculture, the situation is currently so serious that even the country's grain yields are threatened. The plague has now spread across 14 provinces.
In addition, it has also been announced that Australia will definitively import wheat. That is a unique situation, given that the country usually exports a lot of products. This is the first time in 12 years that the country has started importing, which is mainly due to the fact that Australia has now been hit by extreme drought for 3 seasons in a row.