Wheat initially continued its previous rally at the start of the week before the picture reversed. On the CBoT, SRW May climbed to a multi-month high at the start of the week, supported by ongoing concerns about drought in the US Plains and uncertainties following the Supreme Court's customs ruling. HRW wheat also benefited initially, but came under greater pressure as the week progressed. With improved weather forecasts, announced precipitation and rising temperatures, risk premiums increasingly receded from the market. A wait-and-see attitude dominated towards the middle of the week, before SRW was able to gain again towards the end of the week, while HRW continued to fall.
Internationally, the lively tender activity attracted attention. According to traders, Algeria secured around 600,000 tons of milling wheat at C&F prices of 259 to 260 US dollars per ton, presumably from the Black Sea region. France was left out. Saudi Arabia and Jordan also tendered larger quantities. The US export data was mixed and was only able to support prices in phases. On Euronext, May briefly approached the 200 euro mark, fell in the meantime and ended the week somewhat firmer.
Corn was comparatively stable. Very strong US export inspections at the beginning of the week provided support, as did robust ethanol data. Weaker export bookings slowed things down temporarily, but international purchases from Turkey and South Korea as well as larger sales to Japan kept prices on the upswing overall. On Euronext, June moved sideways in a narrow range with a slight recovery towards the end of the week.
ZMP Live Expert Opinion
The markets have already given back some of the weather premium in wheat. If the predicted precipitation in the US Plains materializes, the selling pressure is likely to continue, especially for HRW. At the same time, brisk demand from North Africa and the Middle East shows that there is buying interest at the current price level. In the case of maize, export momentum remains the central pillar of support. In the short term, a sideways movement with increased volatility seems likely, whereby new weather risks or further large tenders could quickly lead to a change in direction.
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