The week was characterized by volatility for wheat and corn. With positive signs, the most traded May contract on Euronext/Matif for wheat closed yesterday at 200.25 euros/t and thus above the mark from last Friday, when this contract was still quoted at 198.25 euros/t. This Friday, there are once again positive trends in wheat until the early afternoon. Corn was also able to close a little tighter again. The closing price last night was 171.75 euros/t, today there are marginal increases until the early afternoon. On the CBoT, wheat also rose on a weekly basis while corn closed weaker. Overall, little has changed in the fundamental situation. Competition from Russia and Ukraine is still fierce. Polish farmers are still protesting at the border with Ukraine against cheap offers from the country. Meanwhile, the Polish government plans to restrict demonstrations by declaring border crossings “critical infrastructure”. However, the contracts received a boost from new export rumors that China and Nigeria are said to have purchased larger quantities of grain in Europe. In the last major Egyptian tender, wheat from Romania was able to hold its own alongside Ukraine. Fresh European export figures are still not available. The EU statistics only know the quantities up to February 13th, according to which EU wheat exports of 19.89 million tonnes are around 900,000 tonnes behind the previous year's value on this date. Japan and Tunisia are currently active on the global market with larger tenders. In terms of forecast estimates, the IGC recently left its forecast for the global wheat harvest unchanged at 788 million tonnes. However, due to better export demand, final stocks at the end of the financial year are likely to be slightly lower than previously expected. Corn production is still expected to be at record highs and the IGC increased its own previous estimate by 4 million tons to a current 1.234 billion tons of corn harvest. The final stocks are likely to be slightly lower than previously expected due to higher consumption, but will still be a good 10 million tonnes higher than in the previous year. Overall, the high global availability and the ongoing harvest in Brazil are shaping price developments in the corn market. The US prices received support this week from higher daily production figures for ethanol. Inventories have also fallen. The grain exchange in Rosario, Argentina, has reduced its own forecast for corn by 2 million tons to 57 million tons. However, current rain showers are improving the yield potential of the areas in Argentina. Shortly before the start of trading this Friday, there are more positive tendencies for CBoT corn in the premarket.
ZMP Live Expert Opinion
Bulls and bears took turns this week, and in the end the contracts in Paris and Chicago were at least firmer for wheat from the now closing trading week. It remains to be seen whether the few supportive news will be sufficient in the long term. The bottom line is that export competition from Russia and Ukraine dominates the current price market.
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