European market
Yesterday's session on Euronext was marked by price swings on nearby maturities of around €2.50/t for corn, €4/t for wheat and €10/t for rapeseed. The crude oil and currency markets are also experiencing renewed volatility. After a hesitant session on Euronext, all products finally ended higher than the previous day. However, the strongest gains were seen in prices for the current season, while prices for the 2024 harvest moved more moderately.
In terms of new crop fundamentals, the IGC released its new wheat production estimates yesterday, lowering its estimate from last month to 798 Mt. Although this figure is higher than for the current season, it is still not enough to offset the expected fall in end-of-season stocks to 259 million tons next year, compared with 264 million tons for the current season. For corn, the IGC has also revised the world's new-crop production potential downwards compared with its last estimate, and is now forecasting a volume of 1226 Mt, slightly up on the current season. World corn stocks for 2024/2025 are nevertheless forecast to be slightly up on the current season.
For the time being, operators are keeping a close eye on the weather forecasts. In particular, temperature and rainfall trends are currently being watched with great interest in several areas of Russia.
American market
Prices in the USA fell back overall yesterday. However, renewed tension between Iran and Israel in the wake of overnight news is pushing the oil market to firm up this morning, increasing volatility and leading to a rebound in other commodities, including wheat in Chicago. Yesterday, wheat prices in Chicago once again tested the $5.35/bu area on the May 2024 futures, returning to their lowest level for a month. Weekly export sales figures also failed to support the market, with confirmed cancellations of sales for the current campaign and a reported business volume of 222,000 t for the new campaign.
In corn, weekly sales published by the USDA exceeded the 500,000 t level. Despite this level, volumes are much lower than in recent weeks, weighing on prices. For the time being, US traders seem to be playing down the impact of the recent drop in yields announced in Argentina. However, the USDA's agricultural attaché in Argentina is now reporting production of 51 million tons, well below the official USDA estimate of 55 million tons at the beginning of April.
Soybean oil prices fell further, marking a new low for the May 2024 contract. Soybean prices for the same maturity broke through $11.40/bu and also closed at a new low. Even though the downturn was also in force for new crops, as the start of sowing approached, the price for the December 2024 maturity is still higher than the level traded last February.
