These are turbulent times in the commodity markets. That became clear again yesterday (Thurs 17 June) but this time not due to a significant price increase. On the contrary, expected precipitation will lower the quotations. The soybean quotation in particular has had to let go.
The soy quotation on the American CBoT almost went into free fall yesterday (Thursday, June 17). Analysts speak of the biggest drop in one day in years. The July contracts fell just below $1 per bushel ($13,30 per tonne). A drop of almost $488 per bushel ($1,19 per ton) in 44 day.
Corn and wheat prices have fallen less rapidly. The July corn contract fell $0,40 to $6,33 per bushel ($249 per ton) and wheat traded at $6,40 per bushel ($235 per ton). The futures market contracts for the new harvest (November and December) have fallen less sharply than the contracts for the old harvest.
Good harvest forecast
The quotations on the Matif in Paris were down yesterday. Corn fell from €258,25 to €246 per tonne. In wheat, however, the decline was limited by €2 to €204,50 per tonne. This may have to do with the fall in the wheat price that started at the beginning of last week. For comparison: on June 7, wheat was still trading at €216,50 per tonne. Good harvest forecasts for Europe are putting pressure on the wheat price, according to several analysts.
According to almost all analysts, the sudden decline is largely due to the weather forecasts. Model calculations predict rain for some important - currently dry - growing areas in the US. Whether that precipitation actually falls remains to be seen. The market clearly expects the weather forecasters to be right. But disappointing export figures, especially for soy, which were presented yesterday, also play a role. Some analysts also point to indications of possible interventions in the market by the American government.