Moderate export figures continue to weigh on the European wheat market. A large tender from Algeria that closed yesterday did little to change that. In the US, wheat was supported by the weather reports. There will probably be less rain in the wheat belt this weekend than previously predicted. In Brazil, soy exporters have the wind in their sails. That may not be the intention of Trump's trade policy, but it is the effect.
The May wheat contract on the Matif closed yesterday €1,25 lower at €209 per tonne. On the CBoT, grains were cautiously on the rise. Wheat was the biggest gainer last trading session with a plus of 1,1%. With that, wheat closed at $5.47¾ per bushel. Corn closed 0,6% higher at $4.84¼ per bushel. Soybeans moved a bit more sideways than grains with a plus of 0,3% to $10.38¾ per bushel.
European wheat exports continue to falter. Up to and including 13 April, 16,67 million tonnes of wheat were exported, according to the latest figures from the European Commission. Last year at this time, the export counter stood at 25,71 million tonnes. Exports are therefore 35% behind last season. In Ukraine, grain exports are also running slower than last season. Up to and including 16 April, Ukraine has exported 34,11 million tonnes of grain, compared to 38,61 million tonnes last season. Maize accounts for more than half of grain exports this season, at 17,87 million tonnes. Furthermore, Ukraine has exported 13,49 million tonnes of wheat and 2,24 million tonnes of barley this season.
There is some demand for wheat again from North Africa. Algeria has secured up to 540.000 tonnes of wheat in a tender. The largest part of this tender would be filled with wheat from the Black Sea region. Sources report that Russia, Ukraine and Bulgaria are the main suppliers and that the average price for which Algeria has secured the wheat is $267,50 per tonne C&F (freight). Tunisia also has a tender open for 75.000 tonnes of wheat. This tender closes today.
India has the largest intervention wheat stockpile in three years, the government announced yesterday. A total of 11,8 million tonnes of wheat is in government stockpiles, well above the 7,5 million tonnes that is the official minimum for the strategic stockpile that India holds.
No rain after all
In the US, wheat players are mainly concerned with the weather reports. The rain front that should bring rain to the southern prairies this coming weekend is moving a little further east, according to the latest weather reports. As a result, western Kansas, Oklahoma and Texas will receive less or no rain, contrary to previous weather reports.
For corn and to a lesser extent soy, the trade is not sure what to make of the precipitation that is also predicted for the cornbelt. On the one hand, rain means that farmers have to wait with sowing early corn. On the other hand, moisture is badly needed, especially in the east of the cornbelt where drought is a problem.
To invest
The trade war is not having an unfavorable effect on Brazilian soy growers for the time being. Anec is raising its export forecast for soy in Brazil for April from 13,3 million tons to 14,5 million tons. The export forecast for soybean meal has also been raised by 100.000 tons to 2,4 million tons. This week it was also announced that the Chinese state-owned company Cofco is looking for staff in Brazil. Reuters reports that the Chinese company is looking for dozens of people for its branch in Brazil. Cofco is one of Brazil's largest grain exporters and also trades in oilseeds, sugar, coffee and cotton. The company also produces ethanol. Cofco is building a new grain terminal in Santos (just below São Paulo). The capacity of the terminal, when construction is completed next year, will more than triple from the current 4,5 million tons to 14 million tons. Cofco is thus somewhat going against the trend of its American competitors. Companies such as ADM and Cargill are cutting back and, among other things, reducing their workforce.