Analysis Grains & Commodities
Locally, some wheat has drowned in France
It is certainly not as wet as it was last year, but it is not the case that there is no water damage at all in Europe. According to the French Ministry of Agriculture, some winter wheat may have to be reseeded due to water damage. Soybean actually took a step up last trading session due to a lack of moisture in Argentina.
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Choose the subscription that suits youThe March wheat contract on the Matif closed yesterday €0,75 lower at €227,50 a tonne. On the CBoT, wheat closed 1,1% lower at $5.85½ a bushel. Corn on the Chicago exchange was mostly sideways, closing half a cent higher at $4.98 a bushel. Soybeans were in the green last trading session, trading up 1,3% to $10.45½ a bushel.
French grain growers sowed 10% more winter wheat last autumn compared to the previous year, the French Ministry of Agriculture announced. A total of 6,35 million hectares of winter grain were sown. This means that the total area of winter grain is 7,2% larger than last season but 1,3% below the five-year average. By far the largest part of the area of winter crops in France is soft winter wheat. Compared to last year, 10% more was sown and the area for the coming harvest is 4,57 million hectares. According to the ministry, this remains a relatively small area compared to what has been sown over the past thirty years.
The fact that more winter wheat has been sown in France compared to last year has everything to do with the weather. Last autumn was somewhat drier, which gave growers the opportunity to go into the fields. However, there are also problems with waterlogging this season. Especially in the more northerly regions of Brittany, Normandy, Champagne and Centre-Val de Loire, yields could be lower due to flooded areas or plots may have to be oversown with summer grain, according to the ministry.
Drought in the US
In the US, wheat prices are under pressure because the recent frost has not caused large-scale damage, as it seems now. A layer of snow has done its protective work, according to US sources. There are some problems with drought on the northern prairies. According to the latest drought monitor, 40% of the main spring wheat areas are dry. By comparison, this week last season, this was 22% of the spring wheat area.
The International Grains Council has increased the global wheat harvest for the 2024/25 season by 1 million tonnes to 797 million tonnes compared to the January forecast. The total grain harvest has been reduced by 4 million tonnes to 2.301 million tonnes. For the 2025/26 season, the weather is causing uncertainty, according to the IGC. In the Northern Hemisphere, it is mainly the cold in winter wheat and in South America heat and drought in maize.
A return of the warm dry weather in Argentina, as forecasted by the weather reports, gave the soybean market support, according to analysts. A drop in the value of the dollar - which acts as a stimulus for American exports - reinforced the positive mood. Trump was also not left unmentioned. Earlier this week there was talk of import duties for cars and other things and yesterday the American president suddenly mentioned a possible deal with China. According to Trump, that possibility is there because of his good relationship with Chinese leader Xi.