Wheat prices were on the rise last trading session. Cold in parts of the US Midwest and Great Plains is worrying the market. The crop that was not thriving on it can be seriously damaged by the frost. In Ukraine, problems with a lack of fuel and liquidity among farmers are causing problems with the maize harvest. The consequences of this will continue into next year, the Ukrainian minister of agriculture expects.
The March wheat contract on the Matif closed €7,50 higher at €304 per tonne. On the CBoT, wheat prices rose 2,3% to close at $7.67¾ per bushel. Corn and soy were also on the rise, but the price increase was less steep than wheat in Chicago. Corn increased 1,6% and soy showed a small increase of 0,2%.
Unusually low temperatures in large parts of the US are cited by several analysts as the main cause of the price increase on the wheat market. There is a good chance that some of the wheat will overwinter in areas where there is no snow cover. There is no snow in large parts of Kansas, Texas and Oklahoma, making the wheat in these areas sensitive to the extension of the cold front that will extend across the central US in the coming days. The extent to which frost damages the wheat will only become clear later. The uncertainty on the market is therefore expected to continue for a while.
Smaller corn harvest and concerns about quality
Ukraine expects to harvest between 22 and 23 million tons of corn. The Ukrainian Ministry of Agriculture announced this on Wednesday, December 21. In 2021, the country harvested 41,9 million tons of corn. In the previous forecast from September, the ministry expected to thresh another 25 to 27 million tons. In an interview with Reuters, Ukrainian Minister of Agriculture Mykola Solsky said that farmers are leaving a lot of corn stuck in the fields due to a lack of money and fuel. They expect to be able to harvest that corn next spring. “That means less volume and poorer quality,” Solsky told Reuters. By December 15, 70% of the expected corn area has been harvested. The yield is 18,4 million tons. The average yield per hectare is therefore 6,27 tons according to the ministry. The totals for wheat and barley for which the harvest has been completed are 19,4 and 5,6 million tonnes respectively.
Delaying the corn harvest until winter and early spring will cause problems with spring operations, Solsky warns. "Plots where maize is still planted will not be ready in time for sowing maize next spring. A different crop will be grown there. I think millions of hectares of extra sunflowers will be sown. This is mainly at the expense of the maize area ." This season, Ukraine threshed 10,1 million tons of sunflower seeds from 4,6 million hectares. 98% of the expected area has been harvested. In 2021, the sunflower seed yield was still 16,38 million tons.