The grain market is struggling to assess the extent of frost damage in the US. This means that the wheat price moves fairly horizontally. Optimism about demand from China is increasing in the soy market, but this is not really getting the market moving yet.
The March wheat contract rose by €3,50 to €315,25 per tonne on the Matif yesterday. On the CBoT, wheat also inched up 0,2% to close at $7.74½ per bushel. Corn was the biggest gainer in Chicago last trading session, adding 1,3% to $6.74¾ per bushel. Soya closed 0,2% higher on the CBoT.
In general, grains on the CBoT are supported by the good export figures. The export figures for corn and soy last week were both near the top of the export range that the trade was expecting. The grain market is having difficulty estimating the frost damage to winter wheat. Both trade and farmers find it difficult to determine how much wheat has been overwintered. Especially in regions where little snow has fallen, there is almost certainly damage to the crop, which was often not in very good shape after the dry autumn. The winter wheat for the upcoming harvest in the US has certainly suffered a heavy blow in the first phases of the growing season, according to various sources. That, to some extent, puts a floor in the wheat market at the moment.
Demand growth
On the soy market, drought problems in Argentina continue to concern traders. In addition, some analysts see signs that demand for soy from China will increase in the near future. The strict corona policy has been abandoned and the virus is spreading considerably. However, the effects on the demand for soy are expected to be less than expected. Analysts see more of the positive effect on the economy of relaxing the lockdowns. China's plan to make it easier to issue visas also supports the soy price. The rising number of infections is putting a brake on the increase in quotations.