European market
Сereal prices were falling in view of the weakness of EU wheat export activities on the international scene, and the failure to cross resistance zones. As for rapeseed, it managed (at last!) to break its resistance level and to rise by 3.25 €/t on the Euronext November contract.
With no surprises, the Ministry of Agriculture is once again revising downwards its 2020 wheat harvest estimate for France to 29.5 Mt vs 29.7 Mt estimated last month and compared to 39.6 Mt last year. This is closer to Agritel's estimate, which remains at 29.2 Mt. The area is revised downwards to 4.28 Mha against 4.35 Mha last month and 5 Mha last year. According to Agritel's analysts, next year's area is expected to increase well beyond the 5 Mha.
The ministry also revised its barley production estimate downwards to 11.0 Mt from 11.3 Mt last month, while sugar beet production is estimated at just 32.2 Mt compared to 38 Mt last year.
On the international scene, Egypt is launching a new call for tenders for wheat today, for shipment on 10-20 November. Yesterday, China bought again 132,000 t of American soybeans. The USA also sold 120,000 t of corn to an undisclosed destination.
Rapeseed is progressing in the wake of other vegetable oils such as sunflower and palm. Crude oil also rebounded this morning in New York to nearly 39 $/b, while the euro remained stable at 1.1850 against the dollar. The sowings are difficult throughout Europe because of the current unprecedented water deficit which is raging from France to Romania.
American market
Yesterday, prices decreased on all products in Chicago.
Soybeans dropped on massive profit-taking after the temporary breakthrough of the 10 $/bu resistance level. It must be said that the crushing activity in the USA is at a 9-month low.
On the corn side, ethanol production is expected to be 20% down vs last year. In addition, the current anticyclonic weather conditions will allow an acceleration of harvesting pace.
American wheat, for its part, lacks competitiveness compared to other major exporting countries.
Funds were net sellers yesterday for 12,500 lots of corn, 6,500 lots of soybeans and 7,500 lots of wheat.
Black Sea market
The wheat and barley harvest is finishing in Russia with respectively 82 and 21 Mt harvested as of yesterday, while 10% of the areas remain to be cut for each crop. At this rate, the gross weight of wheat harvested should exceed 85 Mt at the end of the campaign. Despite these large volumes, the wheat 12.5% FOB Novorossiysk marked yesterday a new high for the current campaign at 226 $/t.
10% of corn and 15% of sunflowers were harvested. Average yields of these two crops are down by 25% on last year's average for the same area done. Harvesting is continuing at a steady pace in still dry weather conditions...
