The grain harvest in Europe is progressing steadily. In fact, in France, the wheat harvest is practically finished. And the quality of the harvested wheat there is not disappointing. In Germany, the harvest is not yet complete. The changeable weather there has caused less damage to the wheat than previously expected, but the harvest is not yet in, DRV warns.
The September wheat contract on the Matif closed last trading session at €2,50 higher at €197 per tonne. On the Chicago exchange, wheat, however, took a step back, closing 3¾ cents lower at $5,03½ per bushel. Corn gained one cent, closing at $3,75 per bushel. Soybeans closed last trading session at $15½ per bushel, down 10,08 cents.
In France, the wheat harvest is almost complete, according to FranceAgriMer. This is the earliest harvest finish in five years. The quality of the wheat sampled so far is good. The protein content in the soft wheat averages between 10,5% and 11,5%, FranceAgriMer writes. The hectoliter weight is relatively high, at 77 kg/hl to 80 kg/hl. The most recently harvested wheat is not yet included in these figures. Due to the changeable weather of recent weeks, FranceAgriMer expects the quality of the late-harvested plots to be lower than the quality figures currently published.
Regional differences
The German Federal Agricultural Service (DRV) released an updated harvest forecast for Germany yesterday. The total grain harvest is now estimated at 43 million tons, compared to 41,7 million tons in the previous forecast. This means the German grain harvest is 10% larger compared to last year. The wheat harvest forecast has been increased by 800.000 tons to 22,4 million tons. Barley, on the other hand, has been slightly revised downward by 100.000 tons to 10,3 million tons.
The weather, which FranceAgriMer also mentioned, is also mentioned again in DRV's explanation. The quality loss due to rain during the harvest is relatively manageable and not as severe as previously expected. However, DRV warns that the harvest is not yet complete. Maize has benefited from the moisture of recent weeks, while this has not been good for the quality of wheat. There are significant regional differences in yield and quality, says Guido Seedler, grain market expert at DRV. On heavier soils that retain moisture reasonably well, yields are significantly higher than on sandy soils.
Fight
The demand for wheat on the global market remains a sensitive issue. Competition is fierce, and both exporters and importers are struggling. Later today, as you probably know, Trump and Putin will meet to discuss the situation in Ukraine. The outcome of that meeting is, of course, impossible to predict, but if a move towards peace is actually made, Russia's role in global trade could naturally return to normal somewhat. Shortly after the Russian invasion began, Ukraine gained more or less free access to the internal European market for many agricultural products. This influx of, among other things, cheap grain from Ukraine, which was not always produced according to strict European regulations, led to fierce protests, particularly in the eastern EU member states. Partly due to this pressure, access for Ukrainian grain to the EU has been somewhat restricted again. The main sales markets for the EU, Ukraine, and Russia are in North Africa and the Middle East. Customers there try to play suppliers off against each other.