Getreide News, 05/05/2023

On a weekly basis, the Kruse for wheat on Matif and CBoT increased slightly. On individual trading days, however, there were sometimes very significant increases on both days. The most traded September date closed yesterday at EUR 239.75/t and was therefore EUR 3 higher than on Thursday of the previous week. The development of Matif maize is different. On Thursday of last week, EUR 235.50 was still on the display board for the front month of June, yesterday evening it was EUR 229.25/t and thus EUR 6.25 less. On the CBoT, both corn and wheat gained on a weekly basis. The renewed tensions in Ukraine are primarily responsible for the recent price increase. Russian targets have been attacked by drones, drawing fierce criticism from the Russian government towards both Ukraine and the US. This caused wheat prices to rise. With the renewed tensions, concerns about the continuation of the grain agreement also receded into the background. Last week, the scheduled expiry on May 18 hardly played a role in trading. As Turkey announced, talks on the extension will be held this Friday.Yesterday, Russia criticized the agreement again, but signaled a willingness to talk. For the tensions in the countries neighboring Ukraine, the countries involved, the EU and Ukraine have agreed on an appropriate mechanism that enables the transit of Ukrainian grain through these countries. To compensate, the affected countries such as Poland, Slovenia and Hungary will receive separate EU funding. However, the conditions for this are not yet known. In its most recent assessment, the EU Commission slightly reduced soft wheat production to 131.17 million tons. In particular, the drought in southern Europe, especially in Spain and parts of southern France and northern Italy, are causing the slight setbacks. According to estimates by the EU Commission, the grain harvest as a whole should be 284.5 million tons and thus above the level of the previous year and the five-year average. The soft wheat harvest is estimated at 131.17 million tons, in the previous year 126.93 million tons of soft wheat were harvested across Europe. Producers in Germany are satisfied with the development of their winter crops.Transactions for the coming harvest are made to a small extent. Old crop inventories are likely to remain high. Market participants continue to assume that farmers will transfer quantities from the last harvest to the new harvest. The corn harvest in the European Union is still higher than the estimate for the previous year at 64.66 million tons, but the harvest is well below the average for the past five years. In the US, weather conditions were positive this week in the Great Plains. The USDA recently raised the condition ratings slightly, although these are still below average. The Oklahoma Grain Growers Association expects the state to have one of the lowest wheat harvests since 1955. Export demand for US wheat remains subdued and keeps slowing price development. In addition to the development in Ukraine, corn prices on both exchanges are also under pressure because of the lush Brazilian harvest. The drought in Argentina hardly features in the market news and is priced in accordingly by the market. The US export reports on Thursday showed that in the week ending April 27th. more open corn orders canceled than new ones closed.Here, too, cheaper offers from Brazil are depressing the mood. Sowing in the USA continues to make good progress, especially in the southern growing states.