Wheat quotes on the international stock exchanges remain under pressure. Corn and soy, on the other hand, are cautiously on the rise. In the meantime, Europe is heading for a smaller wheat yield from last year. Yields are disappointing, especially in Southern Europe.
The wheat market still remains depressed. On the Matif, the September contract lost €6,25 to close at €325,50 per tonne. The August contract on the CBoT closed marginally lower by 0,3% from a day earlier at $8.04,50 per bushel. Soy, on the other hand, closed 0,5% higher, corn even closed 1,2% higher. The new export figures from US Customs will be published on Friday. According to analysts, it is exciting to see whether demand for grains will pick up, now that the price has fallen considerably in the last week.
The weather forecasts are leaving a strong mark on the grain market at the moment. In recent days, precipitation has fallen in certain major corn and soybean growing regions in the US. However, parts of the Corn Belt were missed by the showers. After a drier than average June, there are several areas where the lack of rain becomes an issue. Especially at this stage of the season, when the corn has to start forming the cobs.
What matters again
Drought is also an important factor on the European wheat market. Europe is heading for a smaller wheat harvest due to drought and extreme heat, according to a Reuters poll. According to the poll, the European wheat yield amounts to 125,7 million tons of soft wheat. That is 3,4% less than a year earlier. There are major differences between the regions. It is extremely dry in Southern Europe and the provisional wheat yield figures there are considerably below average. According to the first reports about the harvest in the south of France, the yield there is approximately 20% to 30% lower than the average for the region. Better yields are expected in the north of France. On the Iberian Peninsula, Italy and Hungary, specialists expect significantly lower yields. An above-average yield is expected for Romania and Bulgaria, but no record harvests.
The major uncertain factor are the more northern European countries. According to analysts, the precipitation of recent weeks can still have a positive influence on yields. The yield expectations for Poland and Germany have therefore been adjusted slightly upwards. But the harvest has yet to get off to a good start there, which is why analysts are cautious.
There is also not much to say about the quality. European baking wheat with at least 12,5% protein largely comes from France. The dry weather has cost yields, but is good for yields. The question is what happens with German wheat. A large German harvest - the largest wheat producer in the EU after France - of sufficient quality could give the EU an excellent starting position on the world market to fill the gap left by the war in Ukraine.