Prices on the grain market took a step back last trading session. Europe is suffering from disappointing exports and expected increasing competition from wheat from the Black Sea region. In America, the grain trade is following the meeting between Biden and Xi with above-average interest.
The December wheat contract on the Matif gave up €3,50 yesterday to close at €228,25 per tonne. On the CBoT, wheat fell 2% to $5.60½ per bushel. Corn also lost last trading session, closing 1,6% lower at $4.70¾ per bushel. Soy moved mainly sideways, losing 0,3% to $13.85 per bushel.
Ukraine has exported 11 million tons of grain so far this season, according to figures published yesterday by the Ukrainian Ministry of Agriculture. Last season the counter stood at 15,6 million tons over the same period. Ukrainian exports this season include 5,2 million tons of wheat, 4,9 million tons of corn and 750.000 tons of barley.
Disappointing export figures from both the EU and Ukraine are putting pressure on wheat prices, according to analysts. As a result, a relatively large amount of wheat remains hanging above the market. The negative mood in trade has been further reinforced by the deal between Ukraine and Britain on insuring ships on the humanitarian corridor. This makes transport from Ukraine cheaper and improves the competitive position on the global market.
Problems on the Rhine
The transport of grain within Europe is complicated by problems on the Rhine. This time it is not low water levels that cause problems, but rather too high water levels. Due to excessive rainfall, the level has risen to such an extent that ships can no longer pass under the bridges. German authorities have temporarily halted shipping on the southern part of the river. The blockage is expected to be short-lived and the Rhine can open again on Friday.
China and the US are cautiously approaching each other. The relationship between the two superpowers had cooled considerably after, among other things, an alleged Chinese spy balloon over the US, a row over chip technology and a visit by House Speaker Pelosi to Taiwan. With the meeting between American President Biden and Chinese President Xi in California, the worst of the cold seems to have disappeared. The meeting between the two leaders follows a week in which Chinese grain buyers have secured significant quantities of soy and corn in the US. According to some analysts, strengthening diplomatic ties could lead to additional interest in American agricultural raw materials from China.