The grain market takes another step up. A fall in the dollar exchange rate plays a role in this. But the dry and warm weather also gives the races a boost. The negotiations on grain exports from Ukraine, on the other hand, have only a limited price-pressure effect.
The grain market took another step up in the past trading session after the dip before the weekend. The September wheat contract on the Matif closed yesterday at €335,25 per tonne. That is €9,75 higher than the close on Friday. On the CBoT, the rise was even stronger. There, the September wheat contract rose by 4,6%. Corn and soy were also on the rise on the US stock market, but less solid than wheat. Soy rose by 2,3% and maize by 1,3%.
Analysts are calling for a friendly trading day for commodities on the exchanges. Not only grains closed higher, energy and metals were also in the plus. The lower dollar has contributed to the friendly sentiment. This gave the products denominated in dollars a boost.
Corn and soy are good on it
The USDA released the new edition of the Crop Progress report yesterday (Monday, July 18). On average, corn and soy are doing well in the US. 63% of the corn acreage and 62% of the soybean acreage has been awarded good or excellent status by the USDA. That's in line with what trading expected. Warm and dry weather is forecast in the Midwest and several analysts are concerned about that. Drought and heat cause stress on the crops and ultimately cost yield. Especially in this crucial phase of the growing season, when both maize and soya are in bloom. The winter wheat in the US has now been harvested for 70%. Summer wheat is still lagging behind in development. 68% of the acreage is in the ear. The five-year average for this period stands at 90%. Of the acreage of spring wheat, 71% is given the status of good or excellent.
Analysts are also closely monitoring developments in Ukraine. Negotiations to resume grain exports from the Black Sea ports will resume this week. A Turkish official told Reuters news agency that there are "minor problems" that can be overcome. The United Nations is less forthcoming about progress. A UN spokesperson spoke of "ongoing negotiations" to resume exports. Ukrainian farmers sitting on the fringes of the front line, meanwhile, are rushing to bring in the grain harvest. Russian bombings are causing fires in the grain plots and several plots have already been lost as a result.