Apparently the grain market is babbling on a bit. The harvest in the northern hemisphere is largely over and the harvest figures are just about known. However, the market continues to surprise with export figures that are not in line with expectations. Furthermore, Russia also remains a market-defining player.
The wheat quotation on the Matif and CBoT made an opposite movement yesterday, October 27, just like the day before. What was different this time was that the Matif was cautiously on the rise while the CBoT gave up something. The December wheat contract closed at €336,50 per tonne on the Matif. That is a small increase of €2,25 compared to the day before. In Chicago, wheat prices fell 0,2% to $8.38,50 per bushel (approximately €310 per tonne). The price of corn was also under some pressure on the American stock market and fell by 0,4%. Soy showed a minimal increase in the last trading session.
The European wheat quotation was given a boost by a fall in the exchange rate of the euro. The price on the Matif is therefore more favorable compared to the Black Sea wheat. The Black Sea region continues to be a source of concern on the grain market. While traders had until now more or less assumed that the grain deal between Russia and Ukraine would be extended, Moscow pushed back yesterday. According to the Kremlin, the current deal does not help enough to keep the export of Russian grain and Russian fertilizers going. The Russians are therefore wondering whether the deal should be extended at all.
Global market
In the EU, the drought has major consequences for the corn harvest. The European Commission has lowered the yield forecast to the lowest level in 15 years. Analysts expect that European players will therefore have to buy extra corn on the world market. There is little evidence of this in the US. There, the export figures from the USDA caused unrest on the market. Corn exports in particular lagged sharply behind trade expectations. Soy exports fell neatly within the expected range and wheat even exceeded that. Despite better-than-expected exports, wheat prices did not increase. The moderate mood in the US is partly due to the weather developments in Argentina. Important arable regions are struggling with drought. In some places no significant rain has fallen since May. However, there has been some relief this week with 20 to 100 millimeters of water.