European market

There was little change yesterday in the grain market, while oilseeds marked a sharp decline.

The water deficit that persists in France and a large part of Europe supports prices, while activity on the international scene remains weak. Only Japan bought a little more than 112,000 t of milling wheat from the USA, Australia and Canada yesterday. It’s still raining on the Black Sea basin, suggesting a good corn harvest in Ukraine, that could continue to be the leading corn producer of the European continent.

The euro continues to rise against the dollar, posted at 1.1090 this morning, welcoming Europe's intentions to revive its economy, by injecting a lot of liquidity. Crude oil remains relatively stable at 33.20 $/b on New York.

Wheat planting is accelerating in Argentina in favour of milder weather, to date, 13.4% of sowings are already done according to the Buenos Aires stock exchange.

The European Commission has significantly revised down its wheat production estimates to 121.5 Mt from 125.8 Mt last month, compared to 130.8 Mt last year. In this context, the Commission displays an estimate of third-country exports at 26.5 Mt, compared to 32.5 Mt for the 2019/2020 Mt. Upcoming barley production is displayed at 56.2 Mt and corn production at 71.4 Mt. Rapeseed production is expected to be almost as poor as last year, at 15.6 Mt compared to 15.25 Mt in 2019.

Globally, the IGC revises up its estimate of world wheat production to 766 Mt and that of corn to 1.169 billion tonnes.

Rapeseed prices lost ground yesterday, against the decrease of soybean, canola and palm prices.

American market

Good performance in wheat and corn prices was seen yesterday in Chicago, in the context of the return of dry weather giving fear of water stress for the coming weeks.

The funds are very short in corn and are usually buying their positions in this weather market period, even if the fundamentals predict an abundant supply worldwide for the next season.

Soybeans were penalized by a rebound in crude oil stocks and by profit-taking on the palm. Finally, traders fear that tensions with China will once again make the latter turn towards South American origins.

The funds were net buyers yesterday for 28,000 lots of corn and 11,000 lots of wheat. They were net sellers for 3,000 lots of soybeans.

Black Sea market

Yesterday, at the conference "Grain & Maritime Days" in Odesa, the president of the Ukrainian grain association of exporters announced an upward revision of Ukrainian wheat production to 26.7Mt following the beneficial rains observed in May.

Thus the range of wheat production estimates in Ukraine remains very wide, the most pessimistic expecting 23Mt while the most optimistic anticipate a harvest at 28Mt (Crimea included). In this context, the results of our crop-tour which will be carried out between June 15 and 19 in Ukraine are already awaited by the operators. We will keep our usual route and take the time to assess the situation in the southern oblasts (Zaporizhia, Kherson, Odesa) where the most significant yield cuts are expected compared to last year.