Analysis Grains
Frost is almost forgotten on the wheat market
Now that the temperatures in Europe, the US, and Russia have risen, the cold of a week ago seems to be forgotten on the wheat market. The American president Trump continues to provide one surprise after another. This time it was the plan for a tariff on ships built in China that visit American ports. Corn and soybeans were also under additional pressure due to favorable weather in Brazil.
The March wheat contract on the Matif closed €2.25 lower at €224.50 per ton yesterday. That is the lowest closing price since early December. Wheat also took a step back on the CBoT and closed 1.9% lower at $5.79 per bushel. Corn followed a similar movement and closed 1.8% lower at $4.82½ per bushel. Like the grains, soybeans also turned red and lost 1% to end at $10.29 per bushel.
In the US and Russia, there were concerns about frost damage, which supported the wheat price. With the arrival of milder weather, the stories about frost damage seem to disappear. Reassuring reports came from Russia yesterday. The late frost period in Russia caused little damage to winter wheat in the south of the country, according to the Russian state weather service.
The price of Russian wheat is still on the rise. Ikar raised the quotation for Russian wheat by $4 to $251 per ton. However, Russian grain exports took a step back. Last week, 510,000 tons of grain were exported according to SovEcon, compared to 570,000 tons the previous week. Wheat exports, on the other hand, remained stable at 420,000 tons.
Soybeans also faced some pressure on the CBoT due to relatively favorable weather in Brazil. Last week, growers were able to make progress with soybean harvesting and planting a follow-up crop of corn. Some rain is expected now, and although it may slow down the soybean harvest, it will provide a good start for the newly planted corn. Rain fell in the middle and south of Argentina last weekend, with more to come. Locally, this could cause waterlogging according to sources. However, the rain is passing by the dry north.
