COTidienne | Cereals – New marked drop in wheat prices listed on the CBOT, good resistance on Euronext

THE prix futures contracts on wheat and corn fell further this Thursday, November 14, 2024 on the CBOT. The drop applies to all maturities (between -8.25 and -10.25 cts$/bushel depending on the terms) with that of March (the most worked) below 550 cts$/bushel in wheat and declines between -5 and -7.5 cts$/bushel on the four closest maize maturities.
Faced with this third session of marked decline across the Atlantic, prices on Euronext held up well: declines of between -0.5 and -1.75 €/t in wheat until September 2026, then increases thereafter; small increase for corn, between +0.75 and +1.25 €/t for all maturities.
On the markets hexagonal physical, prices increased slightly in soft wheat, barley fodder and corn while those of durum wheat remained stable.

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The strength of dollar facing theeuro largely explains the behavior of the markets this Thursday. The session on the foreign exchange market once again showed the euro continuing to weaken against the greenback, the parity closing at $1.053 ($1.0496 at the lowest during the session) against $1.056 the day before. We are still waiting to see the consequences of such a context, namely a drop in competitiveness from American origin toexportation and a revival of the origins Europe and others. To be continued…
However, the good resistance of wheat listed on Euronext perhaps finds part of its origins in this monetary weakness and the fact that French wheat has regained the favor of certain importers. To be confirmed…

Also note, across the Atlantic, short positions every day since the start of the week, in both wheat and corn. Side wheat more particularly, the forecasts of production in Australia (25% of the harvest carried out, which can reach 34-35 Mt) are improving, according to a major operator in this market, while those concerning the Russia are falling for the 2024-2025 campaign (the next Russian campaign should be better), according to SovEcon. Still about Russia, the quota available toexportation for the period February-June 2025 could be drastically reduced, to only a third of the 29 Mt authorized last year, according to Reuters reported by Atria Brokers. According to the latter, the pace of exports at the start of the campaign and a harvest lower than expected explain this decision.
We now expect a drop in temperatures in the coming weeks UNITED STATES. Grains Strategy projects an increase in the sole for the entireEurope for 2025-2026 in wheat but a decrease for barley.
In France, for week 45 from November 5 to 11, 2024 and according to the Céré'Obs report from FranceAgriMer, soft wheat sowings are progressing well, as are those of winter barley thanks to a meteorology finally became more lenient again for agricultural work.

Regarding the buttechnical sales and those of funds further weighed on the session, with operators taking their profits. At Brazilthe Conab slightly revised upwards its production estimate for 2024-2025 (no change for the second harvest) and the Rosario Grain Exchange lowered its forecasts by production Argentina for 2024-2025. Rainfall remains insufficient in producing regions. Corn listed on Euronext benefited from cheap purchases. Grains Strategy projects a decline in the sole for the entireEurope pour 2025-2026.
On the international corn markets, certain specialists, who note rather sluggish demand from the Chine Currently, they expect a rebound after the Chinese New Year, according to Asap Agri, who also believes that the Brazilian origin will then be best placed to meet the needs of the country. Mexican demand for corn could slow down in the coming months.
In Francefor week 45 from November 5 to 11, 2024 and according to the Céré'Obs report from FranceAgriMer, if grain corn growing conditions remain stable, the harvest is progressing well over the week even if it is very late compared to last year.

As of November 8, 2024, the production weeklyethanol The United States increased to 1.113 million barrels per day (+8,000 barrels per day compared to the previous week) and the stocks Cumulative quantities increased to 22.039 million barrels (+19,000 barrels compared to the previous week). Note that at UNITED STATESthe new president appointed Lee Zeldin, a fierce opponent of biofuelsat the head of the country's Environmental Protection Agency, potential bad news for producers and the sector bioethanol notably.

The Nigerian government has obtained a $134 million loan from the African Development Bank (BAD) in order to revitalize the agricultural sector, by increasing “the production of seeds and of cereals in the country,” according to the country’s Ministry of Agriculture. This particularly targets the production of wheat, rizcorn, sorgho or even military. The loan should “help 250,000 wheat farmers” and “150,000 rice farmers” according to AFP.
Furthermore, the European Parliament adopted, on November 14 in plenary session, the proposal to postpone by twelve months the date of entry into force of the regulation on imported deforestation (RDUE), also incorporating modifications (new category of “insignificant risk” countries).
In Francel’INSEE releases the final inflation figure for October today as the European Commission presents its economic forecasts for 2024-2025.

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Fundamentals:

• Brazil, corn, production : revised to 119.81 Mt in November for 2024-2025, compared to 119.74 Mt last month (source: Conab);
• Brazil, wheat, production : revised to 8.11 Mt in November for 2024-2025, compared to 8.26 Mt last month (source: Conab);
• Russia, winter wheat, sowing : revised to 15.4 Mha, the lowest level since 2018-2019 (source: Rusagrotrans);
• Russia, winter wheat, sowing and production : revised to 84.5 Mt (source: Rusagrotrans).

Commerce international :

• Brazil/China, corn, exports : revised to 11 Mt for 2024-2025 for 2024-2025, against 10 Mt in 2023-2024 (source: Asap Agri);
• Ukraine/China, corn, exports : revised to 3 Mt for 2024-2025, compared to 5 Mt in 2023-2024 (source: Asap Agri);
• Argentina, corn, production : revised to 50-51 Mt for 2024-2025, compared to 51-52 Mt previously (source: Rosario Cereals Stock Exchange);
• Ukraine, cereals, exports : since the start of the 2024-2025 campaign, the country has exported 15.9 Mt (compared to 10.9 Mt in 2023-2024) including 8.2 Mt of wheat, 5.7 Mt of corn and 1.7 Mt of barley (source: The Latifundist).