Sufficient rain on time can make a world of difference to a crop's yield. This is evident from reports from Russia. Analysts say yields in top-producing regions are enormous, whether rain or no rain occurs. The weather is certainly favorable for harvesting, not only in Russia but also here in Europe.
The September wheat contract on the Matif closed yesterday up €1 at €196,75 per tonne. On the CBoT, wheat closed down 5.42 cent at $0,4¾ per bushel. Corn showed a slight increase, closing 4.12% higher at $1,2½ per bushel. Soybeans retreated, declining 10.12% to close at $XNUMX¼ per bushel.
Weather can make or break a crop. This is once again clearly demonstrated in analyses of the Russian wheat harvest. In the Rostov region (in southwestern Russia, bordering Ukraine), wheat yields are expected to be approximately 20% lower than previously anticipated. The reason for the lower harvest forecast is that growers in this region are dealing with the second consecutive year of drought. Rostov is normally the largest wheat-producing province, accounting for approximately 12% of the total Russian harvest. Further southeast, in Stavropol, the growing season has been much more favorable. According to some analysts, a record harvest could even be on the horizon there. This would dethrone Stavropol as Russia's largest wheat producer.
Threshing weather is expected in southern Russia, as well as eastern Ukraine and western Kazakhstan. With temperatures in the 30s and no rain expected until at least mid-next week, growers can enjoy the harvest, according to various sources. Warmer and drier weather has also returned in western Europe, allowing growers to resume harvesting. The availability of wheat from the new crop is detrimental to prices.
What does Wasde do?
The weather, so to speak, isn't exactly boosting the grain market's spirits. In fact, the yield forecasts in the June edition of the USDA Wasde report were positive, and several analysts are worried about what the July edition (published Friday, July 11th) will bring. In the major corn and soybean growing regions, both crops are doing well. Europe is a bit dry, but winter grain yields here don't seem to be disappointing either. In South America, Brazil has already harvested a record soybean crop. The subsequent corn crop (which is now being harvested) has also performed exceptionally well, according to preliminary reports.
US President Trump also remains uncertain. The dispute over postponing import duties until August 1st has now been resolved. Yesterday, Trump issued a warning to Brazil. That country could face higher duties because, to paraphrase Trump, it "has treated us badly."