Unrest surrounding Iran and Ukraine is keeping the grain market occupied, but rain in the US is putting more pressure on wheat prices. At the same time, the first USDA report shows a moderate crop condition. Read more about the US wheat market.
The Paris stock exchange was closed yesterday due to the long Easter weekend. The CBoT was open, however, and wheat closed 3 cents lower in Chicago at $5.95¼ per bushel. Corn closed in the green with a gain of 1¾ cents to $4.54 per bushel. Soybeans closed 3¼ cents higher at $11.66¾ per bushel.
The unrest in the Middle East continues to preoccupy the grain market. Attempts to bring the US and Iran to a ceasefire have yielded no results so far. In fact, Trump has set a new deadline and is now demanding that Iran end the blockade of the Strait of Hormuz tonight. If not, America will launch a new wave of attacks. Looking at the oil market, trading seems uncertain as to whether Trump will follow through on his threat.
Grain ship sunk
You would almost forget it, but the war between Russia and Ukraine continues as well. Last Sunday, April 5, a ship carrying grain was reportedly sunk in the Sea of Azov by Ukrainian drones. At least, that is what the Russian state news agency Tass reports in a report that has been picked up by Western news agencies. It reportedly involved a ship with a cargo capacity of approximately 3.200 tons.
According to market research firm SovEcon, this is the first grain-laden ship to be sunk in the Black Sea/Sea of Azov region since the start of the Russian invasion in 2022. "Against the backdrop of the conflict in Iran and the de facto paralysis of diplomacy between Washington, Moscow, and Kyiv, the risk of further escalation in the region appears to have increased significantly," says Andrey Soziv, director of SovEcon, to Reuters.
Grain hub
Meanwhile, Russia is seeking rapprochement with Egypt. According to the Russian news agency Interfax, Russian President Putin spoke with Egyptian Foreign Minister Badr Abdelatty about establishing a grain and energy hub in Egypt during the latter's visit to Moscow. Putin has instructed his government to develop plans for this.
Meanwhile, Ukrainian President Zelenskyy held a telephone conversation with Egyptian President Abdel Fattah El-Sisi in which, according to Zelenskyy, Sisi pledged that Egypt would no longer import grain from Russian-occupied territories, various sources report based on a message from Zelenskyy on Telegram. Furthermore, according to the Ukrainian president, Egypt reportedly wants to boost Ukrainian grain exports.
Rain coming
According to some analysts, the fact that wheat on the CBoT dropped slightly yesterday is due to the weather forecasts for the US. Rain is forecast for the southern prairies this coming weekend. If all goes well, the precipitation area could extend into western Texas and Kansas, areas that have had little rain so far.
The USDA also released the first Crop Progress report of this season yesterday. Winter wheat in the main US growing regions is in a mediocre state compared to last season. 35% of the acreage received a rating of good or excellent, compared to 48% this week last year. 7% of the wheat in the US is in ear. In California and Texas, the crop is furthest along, with 45% and 30% in ear, respectively.
Sowing of summer cereals has just begun in the US. Five percent of the planned barley acreage has been sown. This is equal to the five-year average. Two percent of summer wheat has been sown, compared to 3% in the five-year average. American arable farmers are slightly ahead of the five-year average regarding corn sowing. Three percent of the planned acreage has been sown, compared to 2% in the five-year average.