The wheat price has taken another step up in the past trading session. Russia remains a major force behind it. No exception will be made for farmers for military service, Putin announced yesterday. This fueled concerns about the 2023 grain harvest.
The December contract for wheat on the Matif closed yesterday at €348,50 per tonne. That is €4,25 higher compared to the day before. On the CBoT, wheat closed 1,6% higher. Corn closed 0,2% higher on the American stock market. Soya lost slightly and closed 0,2% lower.
A possible further escalation of the war in Ukraine continues to play a dominant role, especially on the wheat market. Russian President Putin announced yesterday (Tuesday, September 27) that farmers will not be exempt from military service in the partial mobilization declared last week. The fact that farmers and farm workers are also being called up makes players in the wheat market nervous about the 2023 harvest. Winter wheat has to go into the ground around this time and the harvest of soy and sunflowers has to be largely finished. Autumn work and parts of Russia are lagging behind due to wet conditions. If farmers and their staff are called away to the war in Ukraine, it could become a problem for this year's remaining harvest and for next year's harvest.
“I would also like to address the regional heads and heads of agricultural companies,” Putin said at the televised meeting. "As part of the partial mobilization, agricultural workers are also being called in. Their families must be supported. I ask you to pay special attention to this issue." During the same meeting, Putin said that Russia is heading for a record grain harvest this season. He expects a total grain harvest of 150 million tons, including 100 tons of wheat.
European wheat exports are ahead
In the EU, wheat exports so far this season are narrowly ahead of last season. Up to and including September 25, the EU has exported 8,80 million wheat, according to figures from the European Commission. Last season the counter stood at 8,75 million tons. The fact that exports are ahead of last year is somewhat surprising given the lower yields in many large European wheat regions. Last week, 740.000 tons of wheat were exported by EU member states. France is by far the largest exporter of wheat with 3,36 million tons. Romania and Germany are in second and third place with 1,38 and 0,91 million tonnes respectively. Morocco, Algeria, Egypt, Nigeria and Pakistan are the largest buyers of wheat from the EU.
Partly due to the dry summer, the EU has imported significantly more corn so far. Up to September 25, 6,65 million tons of corn have been imported. Last season the total for the same week was 3,67 million tons. Significantly more corn has been imported, especially from Brazil, and that country is the largest supplier of corn. It is also striking that almost three times as much corn was imported from Ukraine compared to last season. After Brazil, Ukraine is the most important country for European corn imports.