The negative mood in the grain market was still strong last trading session. Certainly in the wheat market there was quite a bit of bullish news, but the market was not paying attention to that. Last night there was some striking news from Russia. The Kremlin would be ready to resume the grain deal. Will things finally shift or is it a storm in a teacup?
The September wheat contract on the Matif fell by €4 yesterday to close at €240 per tonne. Wheat also took a step back on the CBoT, closing 2,1% lower at $6.52¾ per bushel. Corn was also in negative territory, losing 1% to close at $4.97½ per bushel. Soybeans were unchanged at $14.45¾ per bushel.
Russia once again managed to attract attention after the market closed yesterday. Several news agencies reported that Russia would be willing to resume the grain deal. The rumor mill immediately went into overdrive, partly due to a striking statement by the US ambassador to the UN. "We have indications that they (Russia) may want to return to the negotiating table. We'll see what happens," Reuters quotes Ambassador Linda Thomas-Greenfield. Kremlin spokesman Dmitry Peskov told Russian state news agency RIA that "Moscow is ready to resume the grain deal without delay." To add 'that the Russian conditions must be met'.
Russia has carried out a new attack on Ukrainian port facilities on the Danube, according to several sources. Several videos of fires in the port of Izmajil, a city close to the Romanian border, are circulating on social media. It is difficult to determine exactly what happened and the extent of the damage has not been determined by independent sources.
The weather provides direction
In addition to geopolitical developments, the weather is the other major guiding factor on the grain market. More rain is in the forecast in the northern US. This is especially positive for corn in the northwest part of the Midwest. The crop is now in flower there and sufficient moisture and not too high temperatures are good for growth. It remains warm as ever in the southeastern US. But there is also precipitation in the weather reports for the coming days. Corn is a lot more developed there compared to the Midwest.
In the EU, rain delays the wheat harvest. Now that the crop in the northwest is ripe and there is no weather forecast in the coming week, there is a lot of discussion about the quality of the wheat. The hectoliter weight does not increase if the wheat gets wet every time and the protein content also decreases. In addition, a shot is lurking. Some (German) grain buyers advise their growers not to look too critically at moisture percentages, but to use the workable days as much as possible.