Wheat showed a veritable price firework this week. Compared to last Friday, wheat closed yesterday, Thursday, 17 euros firmer with September futures now the most traded. Corn also continued to gain in value and closed yesterday, Thursday, at 207.50 euros/t, 10.25 euros/t firmer. This trend was also evident on the cash markets, although turnover remains modest despite the willingness of the feed industry to buy. There was also a clear price trend on the CBoT, particularly for wheat.
Prices were driven by several factors. The uncertain situation in Ukraine remains and is fueling concerns about the global supply situation. Russia recently destroyed important infrastructure in the export ports with drones. Grain silos were also hit. As usual in April, the weather also plays an important role in trading. In the USA, there are signs of very dry weather conditions with high temperatures in the Great Plains, particularly in Texas and Kansas, in the coming days. At the beginning of the week, the USDA had already downgraded the condition ratings of winter wheat stocks by a significant 5 percentage points in the two best categories. Dry and warm temperatures have also been reported in Ukraine and southern Russia. In Europe, the MARS forecasting service raised its yield forecasts for wheat slightly. Average yields of 5.91 t/ha are now expected. In the EU Commission's harvest estimate updated yesterday, the previous estimate for the soft wheat harvest was adjusted downwards. At 120.18 million tons, the 2024/25 harvest forecast is significantly lower than the preliminary 2023/24 harvest result, with a shortfall of more than 5.5 million tons of wheat. By contrast, the maize harvest is expected to be significantly higher. Here, the Commission expects 68.98 million tons (previous year: 62.27 million tons).
There are still no current export figures for Europe. The Commission is also citing technical problems this week. Fresh figures were last published at the end of March. US wheat exports were somewhat more solid again this week and were in line with analysts' estimates. Corn sales, on the other hand, clearly exceeded market expectations at 1.3 million tons. However, friendly weather prospects in the Corn Belt are having a negative impact. Farmers here can expect abundant rainfall, which may delay sowing somewhat, but will benefit the plants overall.
ZMP Live Expert Opinion
The grain markets have arrived in the weather market. Export figures, the geopolitical situation and export competition are receding into the background to some extent. Nevertheless, the news from this segment will continue to carry weight. Overall, there are signs of a further upward trend. Many market participants assume that the lows in wheat and maize prices have been reached.
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