European market

Another quiet session yesterday with few exchanges including futures markets. The year is ending and wheat prices were slightly up from the day before and compared to one year ago, at 167 €/t July Basis Rouen delivery vs 160 €/t on the 31st of December 2015. In Chicago, the annual decline is reaching -13% because of bigger supplies and a stronger dollar vs major currencies.

On the new CME wheat contract, 891 lots have been exchanged yesterday mainly on 2016’s harvest and the premium with Euronext remains stable at about +7 € on these deliveries. According Buenos Aires stock exchange, the wheat production in Argentina could reach 15 Mt this year vs 12.5 Mt last year, this is mainly due to higher acreage.

Unsurprisingly, Egypt bought 235 000 t of wheat, including 175 000 t of Russian and 60 000 t of Ukrainian. CIF prices were in a range between 197.20 to 197.95 $/t.

On the international stage, we can also note a tender from Morocco in 363 636 t of soft wheat European origin and a similar volume of US wheat. ONICL is seeking 327 273 t of durum wheat as well.

In rapeseed, prices remain supported by veg oils. The drop of palm production in Malaysia added to the current performance of crude oil keep a bullish trend for these products.

The dollar is finishing the year on a weaker note, probably due to profit takings before the weekend.

American market

US markets were quiet dead yesterday and are ending the year on following performances:

• -13% for wheat
• +17% for soybean
• -2.5% for corn

US markets were benefitting from the decline of the dollar. The Eurodollar is finishing the year above 1.05 in a context of profit takings.

Funds were adjusting their positions and were net sellers of 5 000 lots of soybean, net buyers of 3 500 lots of corn and 2 000 lots of wheat.

General context remains heavy for wheat and tight for soybean with a demand exceeding the offer both from USA and the one expected from South America.

Black Sea market

In the middle of this week, Russian authorities have published a production update for 2016’s harvest. The word “record” is used several times in the communique, concerning the wheat, corn, buckwheat, soybean and sunflower but also the sugar beet, fruits and pulses. More precisely, following figures have been released:

• 119.1 Mt of cereals in aggregate (104.8 Mt in 2015)
• 73.3 Mt of wheat (61.8 Mt)
• 13.8 Mt of corn (13.2 Mt)
• 10.7 Mt of sunflower (9.8 Mt)
• 3.1 Mt of soybean (2.9 Mt)