Grain prices were under pressure on the Chicago stock exchange in the last trading session. On the Matif, wheat managed to maintain its upward trend for another day. On the soybean market, the large harvest predicted for Brazil is a price pressure factor. The wheat market remains particularly under the spell of developments in Ukraine.
The March wheat contract on the Matif closed yesterday €0,75 higher at €299,50 per tonne. On the CBoT, however, wheat took a small step back. The March wheat contract lost 0,8% on the American exchange to $7.86 per bushel. Corn and soy also showed a correction and closed 0,4% and 0,3% lower respectively compared to the previous closing price.
Traders on the wheat market are having difficulty assessing developments in the Black Sea region. Russia has indicated that it cannot be taken for granted that the current grain deal, which expires next month, will be automatically extended. Ukraine yesterday released the news that possibly loose sea mines pose a risk to the accessibility of the port in Odessa. Today (Wednesday, February 15), Ukraine called on the UN and Turkey to increase pressure on Russia to stop hindering Ukrainian grain exports. After the Russian invasion of Ukraine almost a year ago, Ukrainian ports were closed for months. Since July, three Ukrainian ports on the Black Sea have been open again under the grain deal.
The world is being deprived of grain
Ukraine has repeatedly accused Russia of slowing grain exports by delaying ship inspections. The inspection of the ships before they enter and leave the Black Sea is one of the conditions in the grain deal to prevent, for example, the import of weapons. According to Ukrainian Foreign Minister Dmytro Kuleba, Russia is deliberately delaying the inspection of grain ships by demanding unregulated documentation and looking for unfounded reasons to halt inspections. "That destructive Russian policy has resulted in a systematic decline in freight turnover within the grain deal," according to the minister. As a result, the world has lost out on 10 million tons of Ukrainian grain in the last three months, according to Koeleba.
Harvest forecasts
The soy quotation is under pressure due to the progress of the harvest in Brazil. According to market agency AgRural, 17% of the harvest was harvested last Thursday. Harvest progress in Brazil is being delayed due to rain. The somewhat slower harvest pace mainly affects the successive crop of maize that is sown immediately after soy. The later farmers sow corn, the lower the potential yield of the second crop in one growing season. The Brazilian market agency Agroconsult has adjusted the total soy harvest in Brazil downwards from 153,4 to 153 million tons. If that yield is actually achieved, it will still be the largest harvest ever.
According to analysts, the fact that soy does not drop further after the predominantly positive reports from Brazil is due to the drought in Argentina. The yields are disappointing there. According to the Buenos Aires grain exchange, the drought would cause exports in dollars to lag by 23% compared to last season. The expected yields of soy and corn are 38 and 44,5 million tons, according to the stock exchange. In September, the grain exchange expected a harvest of 48 million tons of soy and 50 million tons of corn. The harvest of these crops begins in Argentina in April.