European market
The situation remains sensitive at the macroeconomic level, with fears of slowing the US and global growth as a result of the current trade war between the world's two largest economies. The stock markets rebounded yesterday after the deep drop of the day before, but the crude oil has returned to its lowest levels of the year. Fears weighing on the dollar strengthen the euro which returned to test the 1.10 level yesterday.
Despite this heavy context, wheat continues to grow and reaches a new high for 2 months on Euronext. The market thus saw the 3rd sale of French wheat to Egypt since the start of the season and especially the announcement by Morocco of the granting of the full quota of imports at reduced rates of 576 000 t of EU origin wheat. This important volume will have to be delivered before January 31st.
This firmness of wheat brings some support to corn, which nevertheless remains very cautious facing the record yields in Ukraine.
As for rapeseed, it still continues its evolution in a very narrow range of 385.5 to 387.5 €/t on Euronext November 2019 contract waiting for new elements. Nevertheless, the rapeseed prices find support with the daily rise of the canola. The latter has gained more than +3% since the beginning of the week in Winnipeg due to the current bad weather. The canola harvest in Saskatchewan progressed only by 24%, compared to 70% usually.
American market
The prices are consolidating on all products in Chicago with profit-taking after the sharp rise initiated by Monday's USDA report. The wait-and-see attitude is still in place before the October 10 USDA report, which will tell more about US corn and soybean production estimates. Doubts about US yield levels are strengthening and the announcement of a cold snap on the north of the Corn Belt for the end of next week begins to animate the market.
The wheat in Chicago yesterday found support after the announcement of a Chinese purchase of 130 000 t of white wheat. This is the first purchase of US wheat since last March and the largest purchase of US wheat by China for the last 3 years. However, the weekly export sales published yesterday by the USDA remained low as expected at 328 000 t.
Soybeans and corn find support in anticipation of the Trump administration's plan with aids for the US biofuels industry. Easier consumer access to E15 should also be announced, which will support corn prices.
The weekly corn export sales reached 562,000 t which is in line with expectations and well below last year. Soybeans, meanwhile, posted export sales well above expectations at 2.08 Mt with new sales to China.
The funds were buyers yesterday in Chicago of 6000 lots of corn, 2000 lots of soybeans and 1500 lots of wheat.
Black Sea market
According to Rosselkhoznadzor's preliminary data, since the beginning of the marketing year to October 1, Russia has exported 15.5 Mt of cereals and processed products, which represents - 1.6 Mt or - 9% less than the last year's figure on the same date. Exports of wheat and barley decreased by -10% and -26% respectively vs. 2018/19, with volumes of 12.2 Mt and 1.3 Mt. At the same time, the month was a record for soybean exports with 199,000 t of soybeans shipped, which is three times higher than the volume of last year.
As for the main buyers of Russian cereals, since the beginning of the season, Turkey has been in first place with 3.4 Mt of cereals purchased, of which 2.97 Mt of wheat. Egypt and Iran are next on the podium with 1.5 Mt and 694 Kt of imported grain respectively. Among the top 10 Russian grain importing countries, Bangladesh stands out with the strongest growth thanks to its purchases of Russian wheat in September.
