Paris (awp/afp) – After weeks of increases, world prices for cereals (wheat, corn) and oilseeds (soybeans, rapeseed) have fallen, under the effect of the fall in oil prices and excellent trading conditions. culture in the United States.
Soft wheat prices fell, from the Chicago Stock Exchange to the European market, trading Wednesday afternoon on Euronext around 255 euros per tonne for the September deadline (the earliest), ten euros less than A week ago.
“The drop in prices is mainly linked to the drop in oil prices, the good start to the wheat harvest in the southern United States and the very good growing conditions for American corn and soybeans,” estimates Sébastien Poncelet, analyst for France Argus Media (Agritel firm).
“The sharp fall in oil prices – to its lowest level in four months – has a sympathetic impact on the entire world of raw materials, including cereals and especially oilseeds,” he said.
Rapeseed in particular, whose pressed seed produces an oil widely transformed into agrofuel, fell back below 470 euros per tonne on Wednesday after climbing to more than 490 euros at the end of May.
Across the U.S. Plains, growing conditions for corn are “good” or “excellent” in 75% of corn acreage, according to the latest weekly report from the U.S. Department of Agriculture. This is the best ratio since 2021 for a first publication of the season.
Therefore, for Dewey Strickler, of Ag Watch Market Advisors, “there is not a lot of positive news (in favor of a price increase, Editor’s note) for corn.”
However, American yellow grain prices remain supported by “seeding delays” in Illinois, Indiana and Iowa, according to Michael Zuzolo of Global Commodity Analytics and Consulting.
The analyst also sees as a favorable element for prices a potential loss of corn acreage, “due to overly humid conditions, particularly east of the Mississippi, which will benefit soybeans.”
“Rattle ground”
If the market seemed to take a “pause” in the rise in cereal prices initiated in April, it could be called into question by several factors: the return of buyers on the international scene and the persistent concern for the Russian wheat harvest.
In Russia, the world’s leading exporter of wheat, the succession of a period of drought, then frost and the current return of hot and dry weather, has already led the government to revise its production forecasts, now counting on 132 million tonnes of cereals (compared to 146 Mt estimated in April) for 2024.
“Temperatures of more than 30°C are forecast with a lot of wind, the famous Sukhoveï”, a hot drying wind which blows in the steppes of the European part of Russia and Kazakhstan, “feared by the farmers of the southern plains “, specifies Sébastien Poncelet.
The global wheat supply is declining and global stocks are expected to end in decline at the end of the next campaign (2024/25) for the fifth consecutive season, the lowest since 2015/16.
“Until now, the market was not paying attention to it, because Russia was left with two good harvests and was dumping record export volumes at low prices. But if this Source is threatened, the market begins to worry about the reduction in supply from other producers”, analyzes Arlan Suderman, of the StoneX brokerage platform.
If Russia decides to restrict exports, he warns, “it’s going to be a free-for-all for wheat, particularly if India starts importing again this year.”
Another supporting factor: the return this week of major buyers, with two major calls for tenders from Egypt and Algeria.
Egypt purchased 470,000 tonnes of wheat from different exporters (Romania, France, Ukraine and Bulgaria), excluding Russia. “The negotiations were intense, the prices lowered to end up below the Russian offer”, which was the cheapest at 306 dollars per tonne including freight, indicated Damien Vercambre, of the Inter-Courtage firm.
Algeria, he said, bought a huge quantity of wheat, “around 800,000 tonnes, which would be mainly of Black Sea origin”.
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