The year got off to a bumpy start for the wheat market. Prices came under pressure at the start of the week due to continued high inventories and very good harvest prospects in Argentina, Australia and possibly also India. In addition, the subsequent export data from the USDA was disappointing, with sales figures for the week ending December 25 in particular being weak for all wheat varieties. Although prices in Chicago and Kansas rose significantly on Monday, market participants pointed to a general upswing in sentiment that also affected other agricultural commodities. By the middle of the week, players were increasingly returning to fundamental valuation patterns, which led to price losses for SRW wheat, while HRW wheat gained slightly. A slight easing of weather conditions in the US plains had an additional dampening effect. New impetus came in the middle of the week with weather and cultivation news: in the USA, according to the USDA, the condition of winter wheat deteriorated in some regions, especially in Kansas. Problems with the emergence of stocks were also reported in China. This was enough to pull the market up again. However, there was a lack of follow-up buying at the end of the week. On Euronext, the market initially remained decoupled from US impulses, but stabilized in the middle of the week and rose on Thursday.
Corn was also dominated by uncertainty. Prices fluctuated between technical recovery, disappointing export data and the upcoming USDA reports. A record high in US exports in October made for positive headlines, but was put into perspective by the current seasonal low in weekly export sales. In Brazil, the authorities reported a significant increase in exports in December, while drought is increasingly becoming a problem for stocks in parts of Argentina. Overall, US corn fluctuated within a narrow range. In Paris, the corn market showed a more stable upward trend with daily gains over the course of the week.
ZMP Live Expert Opinion
The grain market is eagerly awaiting the USDA reports at the start of the week, particularly the acreage estimates and stock levels. While the wheat market has recently received a boost again, the fundamental situation with high inventories and a good supply situation remains a burden. Weather risks in the US and South America could cause short-term volatility, but a sustained price turnaround will require convincing demand stimuli. In the case of maize, record US exports should provide support, but weak new business is dampening optimism. A sustained bearish sentiment remains likely for the time being.
You see historical data because you're not logged in or not a ZMP Live+ member. Get your information advantage now!
