The effect of the heat wave in the US is noticeable on grain prices. Temperatures are also rising there. In addition, US traders are getting a boost from the Fed's interest rate policy. But the export of grain from Ukraine also continues to occupy the minds.
The increase in the wheat quotation on the Matif remained limited by €5. The September contract has therefore been concluded at €397,75 per tonne. On the CBoT, the wheat price itself jumped by almost 3%. The July contract closed at $10.78,25 per bushel on the Chicago exchange. And it wasn't just wheat that was on the rise on the American stock market. After several consecutive days of declining prices, soy rose by 1% in the last trading session. The corn price has also left the trough and closed almost 2% higher.
The grain market is a real weather market and this has been confirmed again by the quotations. A heat wave is forecast in the US Midwest. In the more northern part this may cost some yield in winter wheat. Where the wheat still needs to develop a little further, it can become emergency ripe. On the southern prairies, the combines grow wheat and the warm and dry weather is more favorable. The suffering caused by the drought has already been suffered there. Corn and soy have only just been sown. Spring in the US has started wet and cold. So it is not wrong that some temperature will rise in the ground with the warm weather. The heat wave doesn't do much harm at this stage of the season. That will change if this weather pattern continues into July. In that month the corn flowers and the growing conditions during that period determine the final yield of the crop.
Support from dollar rate
Furthermore, the quotations on the CBoT have been helped somewhat by a lower dollar exchange rate. That's because the American Central Bank, the FED, has raised interest rates. According to experts, this will give a boost to wheat exports in particular. Ukraine also continues to raise concerns on the grain market. US President Biden suggested this week to build temporary silos in Ukraine to smooth out exports. Turkey is trying to bring the warring parties together and on Wednesday presented a plan for safe routes on the Black Sea. Given the movements on the grain market in recent days, it at least appears that the market is losing hope for a quick solution for wheat exports from Ukraine.