The picture on the grain market is quite mixed this first trading day of the new week. From limited fluctuation to a big result. The Wasde report appears to have only limited influence on the market. It was not only the American ministry that provided yield and stock figures. Perhaps the most striking figures in that respect come from Ukraine.
The December contract for wheat on the Matif is up more than 3,5% at the time of writing this article. With only 1.302 open positions, the role of this contract has essentially been played out. The other contracts for the 2023 harvest are down 0,3% and 0,4%. On the CBoT, the decline in wheat is much stronger, up to almost 3% down. Corn is down approximately 0,5%. the minus. Soya is the exception and is more than 1,5% plus.
The USDA's Wasde report, which was released last Friday, is still having an impact on the grain market. U.S. corn and soybean inventory figures were well in line with what the trade expected at 2.131 and 245 million bushels respectively. U.S. ending wheat inventories of 659 million bushels are lower than the lower end of trade expectations of 670 million bushels. World ending wheat stocks have been reduced by 500.000 tonnes compared to the November edition of the report, to 258,2 million tonnes. That was reasonably in line with trade expectations. The ending stock of maize has been increased by 200.000 tonnes to 315,2 million tonnes and soya has been reduced by 300.000 tonnes to 114,2 million tonnes in the new edition of the Wasde report.
Climatic problems
Market agency Safras & Mercado has lowered the harvest forecast from 161,4 million tons to 158,23 million tons. Drought and atypical weather for the season are the basis for the reduction in the yield forecast. Further reductions continue to loom. If the harvest of 158,23 million tons is actually realized, it would mean a record soy harvest in Brazil. “Climatological issues should remain on the radar,” says Safras & Mercartor. The USDA kept the Brazilian soy harvest at 161 million tons.
The Ukrainian Ministry of Agriculture further adjusted the harvest figures for grains last Friday upwards to 59,7 million tons. The harvest of oilseeds and grains together amounts to 81,3 million tons, compared to 79,1 million tons in October figures. The average grain yield this season is 5,47 tons per hectare. This has surpassed the record from 2021, which stands at 5,36 tons per hectare.
China has harvested 4% more corn this season compared to last season. This was announced by the Chinese Bureau of Statistics. The increased acreage has more than compensated for the crop damage caused by cyclones. The corn harvest is therefore approximately the estimate of the Chinese Ministry of Agriculture, which was 288,84 million tons. The large Chinese corn harvest is especially good news for Chinese livestock farmers, where margins are under considerable pressure.