The December contract wheat price decline on the Matif and CBOT has continued after the release of the WASDE report Wednesday evening. The maize prices on the Matif are also lower, on the CBOT they are unchanged. Prices of the November soybean contract have risen after reports that the US soybean crop has been revised downwards.
The main reason for the lower yield forecast was the lower yield per hectare expectation. The price increase was also held back by the high harvest expectation in Brazil.
The report was a bullish surprise," Successful Farming said, citing a Hightower report. Traders expect lower demand for US soybeans, but lower production was not expected.
Although the forecasts are lower than predicted six months ago, the price of soybeans has not gone up. Traders are in doubt about the size of Chinese demand. Moreover, figures indicate that Brazil will deliver a record crop of soy this season.
On Wednesday, the United States Department of Agriculture (USDA) announced that China has purchased 526.000 tons of soybeans for the current season. This is the biggest one-day oil seed sale since June 11, 2020. So while Chinese demand appears to be recovering, that assumption may still be a bit premature. Because normally, during this week, China buys between 1 and 2 million tons of soybeans and sometimes even more.
Wheat
Wheat prices on the CBOT fell Wednesday after the USDA lowered demand forecasts and closing inventory, but it was less than previously expected. US production and export forecasts and the likely amount of grains for animal feed have been revised downwards.
The global wheat market still keeps an eye on grain shipments in the Black Sea. On Wednesday it was announced that Algeria is buying about 0,5 million tons of grains, part of which probably comes from Russia. Another part can come from France, this country normally supplies a lot of wheat to Algeria.
FranceAgriMer said on Wednesday that it estimates French exports of common wheat outside the EU are now 15% higher than a year ago. However, this would depend on an extension of the Ukrainian grain deal. In the US, winter wheat sowing continues steadily, although there are concerns about the drought on the Plains. On Sunday, 55% was sown, so progress is in line with analysts' expectations, although there is a gap with the five-year average of 58%.
Corn
On the CBOT, the maize price remained the same, because although the harvest forecast has been lowered, so has the demand. The status of American corn has improved, with 54% of the crop now being good to excellent, compared to 52% last time. Last year it was 60%.
The US corn crop is now estimated at 171,9 bushels per acre. This is in line with the expectations of analysts, who already expected a lower yield due to the drought. It is expected that 91,2% of the maize sown will be harvested, which is equal to the five-year average. It is the third month in a row that the USDA has lowered its yield per acre. The last times this happened was in 2012 and 1993, the years when there were droughts and floods.
Futures
The price of the December wheat contract on the Matif closed on Wednesday at €353,25 per tonne, down 0,77%. The December wheat contract on the CBOT closed slightly lower on Wednesday at $8,84 per bushel ($324,72 per tonne), down 1,94% from Tuesday.
The price of the November corn contract on the Matif closed 0,15% lower and ended the day at €340,25 per tonne. On the CBOT, the December corn contract remained flat. It again finished at $6,93 per bushel ($272,82 per tonne). On the same exchange, the November soybean contract was on the rise, closing 1,49% higher at $13,95 per bushel. ($512,67 per tonne).