Wheat, corn and soya futures have all levelled in the US at the end of
the week as traders take stock. This follows a sharp fall over the last week with
large crop reports from the world's major producing areas, especially last week's
WASDE upgrade to Russia's prospects. But EU futures are still falling.
Nearby CBOT wheat futures are at $4.16 per bushel, up from
the contract low of $4.14¾/bu, with December values 0.5% higher at $4.42¾/bu from
Thursday's low of $4.38¾/bu.
With the US winter wheat harvest complete, growers are now harvesting
spring crops. Analysts say this will limit further crop damage, although yield
prospects are down after the prolonged hot, dry weather in the growing season.
"Grain prices will trade largely sideways in the coming
weeks as wheat harvests are nearly finished and weather conditions remain
favourable for upcoming northern hemisphere corn and soybean harvests," comments
analyst BMI Research.
Corn up from 11 month low
While the corn harvest is still some way off, the CZ7 CBOT contract
rose by 0.1% to $3.64¾/bu from the 11 month low of $3.63¼/bu it reached on Wednesday.
USDA data showing corn export sales of 62,400 tons of old crop and 671,800 tons
orders for new crop were described as "within trade expectations".
The CBOT SX7 soybean
contract was 0.2% higher at $9.35¼/bushel. USDA export data shows China buying
a lot of old and new crop soybeans, with 1.35m tons committed. US soybean
exports had been depressed in recent months in the face of the record Brazilian
crop, but the demand from China is supportive to CBOT soybean futures. The US
Soybean Export Council reported that Chinese importers had signed agreements to
buy 3.8m tonnes of US soybeans, with a value of some $1.56bn, at a ceremony in
Omaha, Nebraska on Tuesday.
The USDA Drought Monitor predicts "significant" rainfall
across the corn and soya growing belt in the next two weeks, which will ais
these crops, but "fair to good" harvest weather in the northern US Plains and
Canada over the next two weeks as famers continue to harvest spring cereals.
European wheat values remain under pressure from the weaker
global markets. The Matif September contract is 0.96% down to E155/tonne with the
December contract 0.77% lower at E161.25/tonne.
Wheat quality concerns in EU
Trader Gleadell Agriculture, jointly owned by ADM and
Invivo, notes that the harvest in France is virtually complete and its quality
has improved. Delays continue in Germany, Poland and the Baltic and the UK, and concerns
over quality in these countries are rising.
"The likelihood of more EU feed wheat and increased
production in Russia and Ukraine are seen as negative to EU prices, although
logistics may limit the total volume of Russian exports", it notes. "Black Sea
supplies again filled Egypt's latest tender, with five Russian cargoes booked
out of 15 offered. The solitary French offer was about $10/t too expensive." The
GASC tender attracted 295,000 tonnes of Russian wheat and 60,000 tonnes from