European market

Oil prices, like several agricultural products, are testing technical support levels after the pullback seen over the past few weeks. The euro/dollar parity is edging higher slightly and is showing a modest return to the 1.14 level.

In France, harvest progress is advancing and continues to bring its share of heterogeneity in yields depending on the regions. The early season should therefore allow work to move ahead quickly and provide a clearer view of the production potential of the new crop, with results expected in particular from the Hauts-de-France region. On Euronext, wheat prices moved closer to the 200 €/t support zone during yesterday’s session, before posting a slight increase at the close. Corn prices, still supported by concerns related to heat and the volume losses announced, are posting gains on the Euronext futures market for both old crop and new crop, as well as on the physical market. In this context, it is worth noting the still wide price gap between corn prices in the South-West zone and those in Eastern France, as well as the current gap between corn prices and those of other grain crops.

Oilseed prices were declining in parallel with harvest progress. Prices for the Aug 26 contract on Euronext are therefore approaching technical levels. Canadian canola prices are also testing support zones, returning to levels comparable to the recent lows of June. Upward revisions by StatCan of area estimates for the upcoming campaign provide a reassuring element, confirming the increase in acreage that had been expected. Exceeding 23.44 million acres, the increase in canola area in Canada stands at +8.4 % compared to last year.

American market

Many products retested yesterday, during the session, their recent lows, or even set new lows, as seen with the Dec 26 contract, before ultimately closing the session higher. Operators were indeed awaiting updates from the USDA on quarterly stock levels and revisions to production areas.

The expected decline in wheat areas was confirmed, with a reduction in spring wheat and durum wheat acreage compared to the estimates from last March, but also compared to last year. These crops are respectively estimated at 9.39 and 1.83 million acres. This decline in acreage is compounded by a reduction in winter wheat areas, whose harvests are showing disappointing yields. The overall drop in wheat areas stands at around -2.36 % compared with the USDA’s March estimates. This decline provided support to SRW wheat prices. The Sep 26 contract is thus trading again above 5.90 $/bu this morning, after having traded below 5.75 $/bu during yesterday’s session.

Soybean crops confirm the expected increase in planted areas compared to March estimates and especially compared to last year. Acreage now reaches 85.3 million acres, an increase driven by the profitability of this crop. With a figure within expectations, soybean prices also closed higher at the end of the session.

Corn acreage recorded, unsurprisingly, a decline compared to last year, but the new USDA estimates at the end of June are in line with the March forecasts, at 95.34 million acres, thus maintaining its position as the leading US crop. In Chicago, Dec 26 corn prices experienced strong volatility yesterday, hitting a new contract low early in the day at 4.2575 $/bu before ending the session above 4.35 $/bu, thereby offsetting a large part of the previous day’s decline. With acreage now confirmed, operators will remain highly attentive to crop conditions and the evolution of weather conditions as the flowering period approaches.

Black Sea market

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