It is certainly not boring on the grain market. A grain ship was hit by a Russian missile on the Black Sea and Strategie Grains lowered the yield forecast for European wheat. Add to that the buying desire of Egypt and you have enough food for the bulls in the market. The USDA roughly pulled that trough away.
The December wheat contract on the Matif closed yesterday €0,25 lower at €222,75 per tonne. On the CBoT, wheat also lost some ground, falling 0,1% to $5.78½ per bushel. Corn rose 0,3% to $4.06 per bushel. Soybeans made a bigger move, gaining 1% to $10.10¾ per bushel.
Strategie Grains has cut its yield forecast for the EU wheat harvest for the second month in a row. The market agency now expects a harvest of 114,4 million tonnes, 10% less than last season and the smallest European grain harvest since 2012. The wet growing season in Germany and France is the main reason for the cut.
In the Black Sea, the bulk carrier Aya was hit by a Russian missile. According to sources, the ship was near Romanian territorial waters, not far from Constanta. The bulk carrier had loaded grain in Chornomorsk and was on its way to Egypt with a cargo of wheat. No one was injured in the attack and the ship was able to continue sailing under its own power.
The Russian missile attack on the Aya comes at a salient time. Egyptian state buyer Gasc and Russia are said to have made a private deal for the supply of wheat. Gasc bought 430.000 tons of Russian wheat for $235 per ton.
Bummer
The US Department of Agriculture changed the mood with the September edition of the Wasde report. No changes for the wheat harvest in America, which will not come until next month. For Europe, the USDA has reduced the harvest by 4 million tons to 124 million tons. For Australia and Ukraine, there was an increase. On balance, world wheat production has decreased by 1,4 million tons to 796,9 million tons. Wheat consumption was increased by 900.000 tons to 804,9 million tons. The expected final stock has also been increased by 600.000 tons to 257,2 million tons. This increase is mainly due to an adjustment in the opening stock of Canada and Brazil.
For corn, unlike the CBoT, the Wasde suggests that it is slightly bearish. Corn in the US is doing relatively well and the USDA expects good yields. If the forecast is correct, America will have the second largest corn harvest ever. According to analysts, the Wasde is slightly bullish for soybeans. The harvest forecast for soybeans in the US has been lowered slightly from 4.489 million bushels to 4.586 million bushels. Not a spectacular change, but in combination with drought in Brazil, analysts see good demand for North American soybeans in the coming fall and winter.