Corn and wheat were able to gain significantly in value again this week. Contracts rose on both the Euronext/Matif and the CBoT. From the closing price last Thursday to yesterday evening, the front month for wheat on the Matif increased by 11.75 euros per ton. Closing price yesterday was 232.50 euros/t. The August date for corn closed yesterday with a settlement of 229.50 euros/t and thus 16.25 euros more firmly than on Thursday last week. The development on the stock exchanges is also reflected in the domestic cash markets. Prices for bread wheat and fodder wheat rose by an average of EUR 10-11 per tonne, while barley fell slightly. Grain corn is also traded more firmly when sales are low. As is so often the case, traders' attention this week was focused on the situation in Ukraine. The destruction of the dam in southern Ukraine has pushed prices up accordingly. According to the Ukrainian Ministry of Agriculture, up to 10,000 hectares of agricultural land on the Ukrainian part of the river have been flooded, and the flooded crop area is likely to be even larger in the Russian-occupied part of Ukraine.According to the ministry, several million tons of grain may have been destroyed. In addition, an ammonia pipeline that is important for Russia and runs through Ukraine to the port of Odessa was destroyed by an explosion. In the past, Russia had always made the operation of this line a condition of its consent to Ukrainian grain exports. As a government spokesman announced yesterday, an important basis for a further extension of the agreement from mid-July would thus become obsolete. The Russian government no longer gives any chance of a renewed extension. In addition to the situation in Ukraine and the geopolitical tensions, market participants are also watching the weather reports with increasing concern. Although the wheat stocks in Germany and France are in very good overall condition, there is already insufficient soil moisture in many regions. In Germany, eastern and southern Germany are particularly affected, and it is also currently too dry in many parts of France. High temperatures and only very isolated possible precipitation are reported for the coming days. A similar weather picture was mostly seen in the Midwest of the USA.A few showers have now been announced in individual states, which should bring relief. In other regions, such as Texas, it is still far too dry. Nevertheless, the condition assessments have recently increased slightly. Market participants on both sides of the Atlantic are eagerly awaiting today's USDA WASDE. The majority is expecting higher US inventories. Export demand in the US has recently been weak and yesterday's publication of the weekly export sales was not euphoric. On the other hand, European soft wheat exports continue to be dynamic. Until 4.6. 28.877 million tons of wheat were exported in the marketing year that was about to end. France remains by far the largest exporter, followed by Romania and Germany. The main customers are Morocco and Algeria. Egypt has recently bought more wheat from Russia, which is also reflected in the order quantities of the North African country in the EU. For corn, analysts for today's WASDE expect Argentina's production for the current season to be downgraded, although this should be more than offset by a better harvest in Brazil.
ZMP Live Expert Opinion
Only fundamental reasons have played no role in wheat since the beginning of the Russian war of aggression. The situation remains tense, as the reactions of the market to the rupture of the dam in the south of Ukraine showed this more than clearly over the course of the week. Overall, the growth conditions for grain in Europe continue to be positive. In the USA, these have recently improved. For producers, however, it currently seems attractive to clear out stocks that are still available.
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