Wheat prices came under noticeable pressure in the past week. While the SRW and HRW contracts were still supported by the strong maize rally at the start of the week, bearish fundamental data dominated events from Tuesday onwards. In particular, the significantly upwardly revised wheat forecast from Abares in Australia and rising export expectations from Ukraine and Russia put pressure on prices on the CBoT. In the middle of the week, the EU's weak export balance also weighed on prices, even if incomplete data from France and other countries made it difficult to make a precise assessment. Unexpectedly strong US export figures were only able to cushion the downward trend, but not reverse it. The state of the US spring wheat harvest was in line with expectations, as was the rapid progress of threshing work. A weak finish followed on Friday, despite a 5-year high in US wheat exports in July.
Corn was volatile in Chicago, but managed to hold its ground over the week. A sharp jump in prices before the extended US weekend, triggered by crop protection concerns and strong export demand, was followed by a phase of mixed developments. In particular, increasing skepticism about USDA yield estimates, exacerbated by a lack of rainfall and disease pressure in the Corn Belt, gave the market a tailwind. Although stock assessments were downgraded slightly, they remained in line with expectations. Positive export figures provided additional support, as did a strong July for ethanol and corn shipments. In Europe, on the other hand, the market remained largely decoupled from the impetus provided by the CBoT. The weak wheat trend weighed on the market, with a slight recovery at the end of the week that quickly fizzled out again.
ZMP Live Expert Opinion
The global wheat markets remain under pressure. In particular, higher harvest expectations from Australia and Russia's continued willingness to export are increasing supply on the global market. Although US exports are unexpectedly strong, this is not enough to alleviate price pressure in the long term. In contrast, there are increasing signs of a fragile yield situation for maize in the USA. Disease pressure, a lack of rain and falling crop valuations could limit the potential. As long as these uncertainties persist, the maize market is likely to remain susceptible to further price impulses.
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