In the grain market, the weather premium is being carefully built up. This is mainly due to setbacks in South America. In Northwestern Europe there are also concerns about wet conditions, although this is only slowly filtering through to the futures markets. On the other side of the Atlantic Ocean, in North America, weather conditions are favorable for grains, according to the new edition of the Crop Progress report.
The December wheat contract on the Matif gave up €1,25 yesterday to close at €232,25 per tonne. On the CBoT, wheat rose 0,6% to $575¾ per bushel. Soya rose slightly more strongly last trading session. The November contract on the Chicago exchange rose 1% to $13.40½ per bushel. Corn was unchanged at $4.77¼ per bushel.
Prices in the wheat market are not moving quite as you would expect. It is wet in the north of Europe. This hinders the sowing of the last winter wheat and wheat that has already been sown has suffered damage here and there. It is not yet possible to determine what the size will be, but we can now conclude that the start for the 2024 harvest is not great. In Ukraine, it is the final stages of sowing winter wheat. According to figures published yesterday by the Ukrainian Ministry of Agriculture, 89% of the planned winter wheat area has been sown. The ministry expects a total of 4,36 million hectares. That would mean a shrinkage of 2% compared to the acreage of last season.
American exports are falling
Saudi Arabia has reportedly purchased 710.000 tons of wheat from Arab producers outside the country. According to sources, it is most likely wheat from Russia and/or Ukraine. Algeria has an open tender for 50.000 tons of wheat that closes today. Despite there being demand on the world market, wheat exports from the US are disappointing. Last week America only exported 2,6 million bushels (approximately 72.000 tons). That is the lowest weekly export for the week ending November 2 since 1983 and the smallest weekly export in 54 weeks. The starting position for wheat for the coming harvest in the US has improved. 50% of the sown area is rated good or excellent compared to 47% last week, the USDA writes in the Crop Progress report. 90% of the planned area has now been sown. This means that this season is once again narrowly ahead of the five-year average of 89%.
The corn and soy harvest is going according to the book in the US. 81% of the corn area has been harvested against 77% in the five-year average and in soybean 91% of the area has been harvested against 86% in the five-year average. This week looks favorable for harvest for most of the Corn Belt with solid dry weather according to local sources. Local showers are only forecast in the east of the corn region.
floods
Farmers in Brazil are having a less prosperous start to the new growing season. In the north it is too dry, while in the south it is much too wet. Analysts are particularly concerned about the south of Brazil. The necessary soya and corn have already been sown there. The question for discussion is how much of this will have to be reseeded due to the floods that have ravaged that area. The other question that arises is whether reseeding can be done in a timely manner. It has been dry the last few days, but according to weather forecasters, more rain is on the way. As a result, agricultural work could be left behind for too long.