The grain market sends varying signals. In Europe, prices are on the rise despite new export figures from Ukraine that show that even without the Black Sea grain deal, grain exports are accelerating. In the US, trading is affected by cold weather forecast for the coming weekend and early next week. Furthermore, developments in the oil market are closely monitored. This is especially important for corn.
The March wheat contract on the Matif jumped yesterday to close €2 higher at €221,50 per tonne. For a change, it was the CBoT that showed a much flatter price movement in grains last trading session. Wheat rose 0,1% to close at $6.10¾ per bushel. The March corn contract showed the smallest possible increase, of a quarter, bringing the closing price to $4.59½ per bushel. There was more movement in soy at the Chicago stock exchange. The March contract closed 1% lower at $12.36½ per bushel.
Russia's withdrawal from the Black Sea grain deal will not have the effect desired by the Kremlin. According to Ukraine, 4,8 million tons of grain were exported through the Black Sea in December through the New Humanitarian Corridor, as the alternative routes on the Black Sea are called. This means that more grain was exported via the Black Sea last month than in the months when the grain deal was still in effect. A success for Ukraine is also reported regarding the route via the Danube. The port of Constanta announced that it will have processed 2023% more grain in calendar year 50, of which approximately 40% came from Ukraine.
While the frost in the Netherlands is over for a while, the US is captivated by the extreme cold that spreads from Canada to the prairies. The cold front is preceded by a snowstorm in the states of Kansas and Oklahoma, among others. No major problems with wintering wheat are expected on the southern prairies. On the northern prairies, analysts are less sure. The low temperatures may cause damage there, experts warn.
Corn bottoms out
The price of corn showed little movement last trading session, but appearances can be deceiving according to some analysts. Ethanol production last week was higher than expected at 1,062 million barrels per day. Total corn consumption in the first four months of the 2023/24 season is almost 7% higher than last year. The USDA expects a growth of 3% this season. Despite the fact that margins for ethanol products are under pressure due to lower oil and gasoline prices, production continues. Greater demand for gasoline in the US will help. Compared to the same week last year, 10% more gasoline was consumed in the US.