International grain prices were under downward pressure this week. Both wheat and corn lost value. Wheat recorded losses for the fifth day in a row and stood at just 536.75 US cents/bushel on the CBoT for September. This was mainly due to the progress of the harvest and subdued export demand. In the US, the winter wheat harvest is proceeding according to plan, and conditions for spring wheat are also good in many places.
However, the weather conditions also put great pressure on prices, especially for maize. The current conditions are excellent. The warm and humid climate promises good yields for the plant. Forecasts for the coming days point to a continuation of the favorable weather conditions.
Internationally, there are also increasing signs of good harvest results. In Russia, yield expectations were adjusted upwards again this week. This surprised traders to some extent, as in the past there had been talk of extreme drought stress and even a state of emergency in some regions. In Brazil, the maize harvest is progressing under normal conditions. Although there have also been regional reports of drought stress, the overall situation appears to be stable. Despite isolated export sales from the USA, for example to Mexico or Asia, global demand has so far remained below expectations. At the same time, the high supply is making speculative buying even more cautious.
Geopolitical tensions in the Middle East conflict were still reverberating at the beginning of the week. Initially, it was not clear how the situation would develop, but the situation currently appears to have stabilized. Concerns that the Strait of Hormuz would be closed by Iran and cause extreme disruption to trade routes have been put to rest for the time being. The focus is now on the upcoming USDA report. This could provide fresh impetus, particularly with regard to acreage and stocks. If the expectation that acreage will remain high and yields stable is confirmed, the pressure on prices is likely to remain for the time being.
ZMP Live Expert Opinion
In view of the current weather conditions and the rapid progress of the harvest, a sustained price turnaround is unlikely in the coming weeks. The supply side remains strong, and as long as there are no major weather-related shortfalls, prices are likely to remain under pressure. The reluctance of many importers to buy also indicates that the market sees further downward potential. The picture could only change if new demand impulses emerge or production risks arise in important regions. The next USDA figures will be decisive - especially with regard to acreage and yield estimates. If these remain high, the weak price trend is likely to continue.
You see historical data because you're not logged in or not a ZMP Live+ member. Get your information advantage now!
