A tender from Egypt did not bring much life to the European wheat trade. In fact, wheat on the Matif had to give up a spring. In the US, the harvest is almost finished and the vast majority of the winter wheat is already in the ground. Despite the drought, according to the USDA, the winter wheat is doing better than last week. Further south in Brazil, growers have made a big push with soy.
The December wheat contract on the Matif took a hit yesterday, closing €3,25 lower at €213,75 per tonne. On the Chicago exchange, wheat closed ¾ cent higher at $5.68¾ per bushel. Corn was slightly more buoyant, closing 0,5% higher at $4.16½ per bushel. Soybeans also closed 0,5% higher at %9.87¼ per bushel.
Limited demand for European wheat is putting pressure on the price in Paris. Egypt had a tender open, but the European exporters could not keep up with the competitors from Russia and Ukraine. Russia set a price of $265 per tonne FOB (delivered on the ship). Ukraine was just below that with $263 per tonne FOB. As far as is known, the Egyptian state buyer Gasc did not make a purchase in the tender.
Rock bottom price not yet a success
Ikar has kept the spot price for Russian wheat unchanged from last week at $232 per tonne FOB. This keeps the wheat price below the minimum prices set by Russian exporters together with the Russian ministry. The minimum price is set at $245 in November and $250 in December. According to SovEcon, Russian grain exports last week amounted to 1,2 million tonnes. This is 100.000 less than a week earlier. The vast majority of last week's grain exports, namely 1,13 million tonnes, was wheat.
In the US, weekly wheat exports were slightly lower than expected by the trade. This had only a limited effect on the market. Compared to last season, the US has exported 35% more wheat so far and exports are 17% ahead of the USDA forecast.
Drought only slightly visible
US growers are slightly behind in sowing wheat this season. Of the planned area, 87% has been sown, according to this week's new Crop Progress report. Last year this week, 88% had been sown and the five-year average is 89%. Of the sown wheat, 66% is above ground compared to 72% last year. It is remarkable that the condition of the winter wheat has improved compared to last week. 41% of the winter wheat is in good or excellent condition compared to 38% last week. This while the drought areas in the US have grown. According to the latest drought monitor, 62% of the wheat is in a drought area compared to 58% last week.
The corn and soy harvests are well underway in the United States. 91% of the corn has been threshed, according to the Crop Progress report. The five-year average is 75% harvested. With soy, American farmers are a bit further along. Of that, 94% has been harvested, compared to 85% in the five-year average.
Over half way
In Brazil, soybean growers have made great strides in sowing soy. According to AgRural, 54% of the planned area has been sown. Last week, the counter was at 18% sown. For the first time this season, the work is running ahead of last year. Back then, 51% of the planned area of soy had been sown this week. Several analysts expect that the field work in Brazil will have to slow down a bit this week. As Formula 1 fans may have seen, heavy showers passed over the south of Brazil last weekend. This is beneficial for the crops that are in the ground, but it has to subside before you can get back on the land with the tractor, local sources report.