Trade and politics cannot always be seen separately. Russia is a special case in that regard. Grain trading company Aston denies previous reports of problems with grain exports. The Russian authorities also report no problems. Meanwhile, Bloomberg reports that yet another company is under scrutiny.
The May wheat contract on the Matif closed yesterday €1,25 lower at €200 per tonne. On the CBoT, wheat rose ¼ cent to $5.56¼ per bushel. Corn rose 0,8% to $4.35¼ per bushel. Soy, unlike grains in Chicago, took a step back to $11.80 per bushel.
The 'Russian soul', incomprehensible to a Westerner, does not only seem to be a theme in the nineteenth-century literature of Dostoyevsky or Tolstoy. There also seems to be no logic behind Moscow's policy on the grain market. The Russian authority that must issue phytosanitary certificates, Rosselkhoznadzor, is said to have blocked the departure of two ships from grain trader Aston. According to various sources, the loaded grain did not meet the quality conditions, which meant that Rosselkhoznadzor did not want to issue the certificates required for export. Aston now denies that any of the company's ships have been blocked by Russian authorities. Rosselkhoznadzor says it has not received any reports from other exporters about problems with phytosanitary certificates.
Despite the soothing words from Russia, Bloomberg news agency reported yesterday afternoon that two ships loaded with wheat destined for Egypt have been detained. According to reports, these Russian ships sail for the Grainflower DMCC company. According to Bloomberg's sources, Grainflower is an export partner of TD Rif. The latter is under the magnifying glass of Rosselkhoznadzor and early last week the export of grain on company ships was blocked by the Russian authorities. The Kremlin is said to be pressuring TD Rif to sell assets at a 'negotiable price'.
Shift
The USDA attaché in China expects that 2,6% more corn will be sown there next season. That goes a bit against expectations. The Chinese government actually focused on the production of more soy. Chinese farmers apparently think differently about this.
In the US, weather reports continue to largely guide the market. After the northern Cornbelt earlier this week, the southern delta and prairies received rain yesterday. With above-average temperatures and drier weather in the middle of this month, things are not looking unfavorable for corn growers. If the weather reports are correct, sowing can start smoothly.