The ups and downs of wheat prices on the Paris stock exchange continued within a range of 215 to 225 €/t in the past month of July-24. A downward resistance line at around 215 €/t is increasingly crystallizing. The price fluctuations are usually triggered by the quotations on the Chicago Stock Exchange. The latest information on harvest results and exports from the major exporting countries play a decisive role.
USA: The winter wheat harvest has largely been harvested in all but 4 states. The results remain largely unchanged from the previous year. The remaining winter and spring wheat stocks are currently being affected by heat and drought. In the weekly stock assessment, the ratings for residual wheat were downgraded compared to previous weeks. In contrast, the ratings for maize remain favorable at +10 % points above the previous year, but the reduced acreage will lead to a smaller maize harvest.
Canada: The high expectations for an above-average grain harvest in 2024 have recently been somewhat dampened by the increased drylands in 35% of agricultural regions. However, total production is still well above the previous year's level.
Russia: The 2024 harvest has so far been significantly ahead of previous years due to the warm weather conditions. In the southern district and in the western Volga region, the grain fields have largely been harvested. However, harvest progress in the eastern regions is currently being hampered by rainfall. Grain prices, which have fallen below the break-even point, have reached their lowest point because suppliers are holding back the goods for the time being. Harvest estimates remain unchanged, but are around 8% below the previous year's level due to cultivation and yield.
Ukraine: The latest estimates for the wheat harvest have been reduced again to 19.8 million tons (previous year: 22 million tons) due to the ongoing drought in many growing regions. The maize harvest has also been reduced by -2.1 million tons to 23.4 million tons. The price declines have come to a halt for the time being.
China: According to the latest reports, China will continue to build up its grain stocks. This could contribute to further increases in imports. However, reservations are called for.
India: Timely, favorable sowing conditions and sufficient rainfall so far mean that a peak harvest of wheat and rice can be expected. However, initial stocks have fallen to their lowest level for years, meaning that moderate wheat imports are still required to cover demand.
Australia: The area under cultivation for grain in 2024 has increased by around 10 %. In view of sufficient rainfall in the south-east of the country, an above-average harvest is expected. In Western Australia, however, expectations remain more subdued.
EU-27: Harvest estimates remain below the previous year's level. Significant yield losses are expected, particularly in France, the largest production region. Expectations in Germany also remain below the multi-year average.
Overall, the positive and negative outlook for a barely improved global harvest in 2024 compared to the previous year is just about balanced.
ZMP Live Expert Opinion
The little-changed outlook of a continued tense global supply situation led to prices of over € 215/t for the market leader wheat. This puts prices well above the level of average years (excluding the brief, extraordinary Ukraine shock phase). The relative shortage is contributing to a very sensitive price trend. The latest developments in the Middle East are exacerbating the tension.
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