The grain market moved mostly sideways yesterday. There was no real impulse to direct the market. Ukraine released export figures yesterday, which were in line with trade expectations. That is different from in the US, where the ministry announced that it would no longer disclose export data for the time being.
Wheat prices closed higher last trading session. The September contract on the Matif closed yesterday at €332,25 per tonne. On the CBoT, the September wheat contract rose 1,3% to $8,09 per bushel (approximately €296 per tonne). Soy and corn closed marginally lower on the American stock exchange by 0,4% and 0,9% respectively.
The wheat harvest in the Northern Hemisphere is largely over. Traders' interest in wheat usually increases at this time. This provides additional support to the wheat price at the moment. In addition, developments in the Black Sea region continue to occupy the market. Ukraine exported 2,26 million tons of grain in August, the country's Agriculture Ministry announced. That is 59,5% less than in the same month last year. Ukraine exported 763.000 tons of wheat, 1,33 million tons of corn and 161.000 tons of barley in August.
No demand for Russian wheat
Despite the record harvest, Russian wheat exports are struggling to get going. In August, the country exported 3,5 million wheat. According to market agency Sovecon, wheat exports in the first two months of the export season are 27% behind last year. That is the smallest export since the 2017/2018 season. Various analysts and market players expect that Russian exports will increase to approximately 4 million tons in September. The demand for Russian wheat is the big problem. According to some sources, hardly any wheat is traded. The export prospects for Russia do not look rosy according to market agency IKAR. This is partly due to the disappointing quality of Russian wheat, lack of clarity and problems with Western sanctions and the sharp rise in the exchange rate of the ruble. Many buyers currently prefer wheat from the EU. Wheat prices in Russia are under pressure and if they fall further and world market prices rise further, demand for Russian wheat could pick up again.
The USDA announced Wednesday that it will not publish weekly export figures until September 15. The ministry is transitioning to a new system and that is associated with a number of problems. Last week, August 25, the published figures were incorrect due to technical problems and the USDA withdrew the data. It has now been decided to completely cancel the publication of the export figures in the coming weeks. This creates additional uncertainty in the already volatile grain market. The weekly export update was introduced in 1973 after the Soviet Union unexpectedly bought a lot of grain a year earlier, consuming the American supply. That then pushed up food prices, according to the USDA.