There was little excitement on the grain market in Europe. That was different in Chicago, where wheat in particular made a remarkable rally. The plane that was shot down in Russia yesterday is cited as one of the causes. It is remarkable that traders in Paris do not seem to respond to this. In Brazil, soy yields currently appear to be nothing to write home about. Unlike earlier this week, developments in China have the upper hand.
The March wheat contract on the Matif closed yesterday unchanged at €217,50 per tonne. On the CBoT, wheat jumped higher to close 2,4% higher at $6.10¾ per bushel. Corn also rose, gaining 1,2% to $4.52¼ per bushel. Soy moved mainly sideways, closing three quarters higher at $12.40¼ per bushel.
A remarkable trading day on the wheat market yesterday. There was a ruckus, especially in Chicago. The dollar took a step back, which, according to some analysts, heralded a buying wave in wheat. This makes grain from the US more attractive on the world market. To some extent this will be the case chart-based buying, buy based on the technical analysis. Wheat on the CBoT broke through resistance early and that gave buyers that extra push. It is mainly the speculators who have invested in wheat and to a lesser extent in maize on this basis.
The unrest in the Black Sea region will probably also have contributed to this. Russia accuses Ukraine of downing a plane in Russia's southern Belgorod region. According to Russia, there were 65 Ukrainian prisoners of war among the 74 victims on the plane. Ukrainian authorities reported yesterday to domestic media that the Russian aircraft was carrying anti-aircraft weapons. Whether Ukraine took down the plane was neither confirmed nor denied. In any case, the European wheat market did not or hardly respond to this.
Moderate soy harvest
Refinitiv has lowered its soybean yield forecast in Brazil by 2% from the previous forecast to 149,3 million tonnes. This reduction was prompted by an almost record low leaf mass on satellite images in the largest soy provinces of Mato Grosso and Parana. Conab reports that 5% of the soy area has now been harvested. In Mato Grosso threshed at 13%. Conab estimates the harvest in this province at 39 million tons. That is 14% less than last season.
China announced an economic stimulus package yesterday. The Chinese economy has been struggling for some time and, according to some analysts, this weakness is putting a brake on soy prices. China is by far the largest buyer on the world market and accounted for approximately 70% of Brazilian soy exports last year.