European market

Choppy session on Euronext yesterday, wheat prices were slightly up, but significant moves affected the front contract of the corn. This delivery plummeted by -3.25 €/t in a context of a bigger competition with Ukrainian origins implied by the cut of import duties in EU.

Planting conditions of winter wheat in France remain favorable in the absence of precipitations and thanks to a mild weather. Same situation in the east of Europe, however, the vegetative development of the crops could be insufficient before winter.

Corn harvest is progressing smoothly in France and yields are globally favorable, suggesting a production above 13 Mt. The competition of Black Sea origins is perceptible with our main customers like Spain.

On the international stage, we can note the sale of 227 300 t of soybean by USA to unknown destination. Algeria is officially buyer of 50 000 t of soft wheat, shipment between 1st and 15th of January. This tender will expire today.

Rapeseed prices were in little decline yesterday, penalized by the weakness of soybean prices unable to break for long the psychological level of 10 $/bushel in Chicago.

Stability of the euro vs dollar despite of Spanish events and a disappointing election for Angela Merkel.

American market

Drop of all commodities yesterday, markets remain depressed. Export inspections were disappointing for the wheat and corn, only soybean figures were ok.

However, soybean prices did not manage to break for long the 10 $/bushel level, pushing funds to sell-off.

Financial funds were net sellers of 5 500 lots of corn, 8 000 lots of soybean and 2 500 lots of wheat.

Updated on last Sunday, soybean harvest was 49% done vs 60% on average in last five years. Corn harvest was 28% done vs 47% in last five years. Wheat plantings were done up to 60% vs 71% in average.

Weather forecasts look favorable to an acceleration of harvest works.

Black Sea market

After a slight delay, winter wheat planting campaign gained momentum and is ahead of the 2016’s pace who was already reflecting a progress compared to the previous year. For last three campaigns, we can note a significant increase of winter wheat acreage in the Russian Federation. This is an important change as it is the way to increase yields and production. This phenomenon is mainly visible in the South-West and Volga areas. The final acreage od winter crops could exceed the level of 2016 at 17.5 Mha. As a reminder, the wheat represents 80% of the total, i.e. 14 to 14.5 Mha. Recent rains observed should ease a part of concerns linked to the hydric deficit recorded these last few weeks.