European market
With the exception of the March 2024 wheat contract, prices on Euronext yesterday rose on all wheat, corn and rapeseed contracts, both for the 2023 harvest and for following periods. For new crops, the current rainy conditions in France are still a cause for concern for the advance or finalization of sowing of certain spring crops. In addition, price levels seem to be triggering some buying interest as technical points approach, at levels still close to recent campaign lows.
The fall in international prices is encouraging importers to return, such as Jordan for wheat, Algeria and China for corn. Due to a technical problem, the weekly export figures reported yesterday by the European Commission only include figures up to last Thursday, with volumes since the start of the campaign at 20.5mn t for wheat and 3.6mn t for barley. Corn imports stood at 11.5mn t.
On Euronext, operators noted the significant narrowing of the price spread observed yesterday between the March 2024 and May 2024 futures for the wheat contract. These contracts are now trading at near parity. Trading volume on the options market was also impressive, with more than 7,400 lots traded on the May, September and December 2024 futures.
The rebound is also visible in rapeseed after its recent low. This product is supported by the rebound in palm oil prices and the firmness seen yesterday on the canola and crude oil markets.
American market
After last week’s renewed downturn, which pushed corn prices back to their lowest levels for over 3 years, prices have shown a slight rebound since the beginning of the week. However, yesterday’s rise still fails to offset recent declines. Nevertheless, the technical rebound seen over the past two days is evidence of the interest, particularly on the part of funds, in repositioning themselves to buy at current levels. The large volumes available on the U.S. market are obviously weighing on prices for the 2023 harvest, with competition on an international level still important, as seen by China’s recent purchases of Ukrainian corn.
The rise in Chicago corn prices has also encouraged a rebound in wheat prices. March 2024 wheat contract returned to its mid-February level, closing yesterday’s session at $5.86/bu.
There was little change on the soybean market. Prices are still very close to their recent lows in Chicago. Prices remain under pressure in the face of rising Brazilian supplies, directly linked to the advanced harvest. This factor is boosting Brazil’s export activity, and means that US origins remain attractive. A new sale for the 2023-24 campaign was reported yesterday by the USDA, for a volume of 123,000 t to an unspecified destination.