Euronext grain market under pressure

• At the end of the previous week and its beginning, the European grain market was marked by a new concern.

Recent price declines have prompted traders to reconsider their stance on fears over comments from Russia about a desire to better control prices and increase Russian benchmark stocks. These tensions were enough to cause an overall rebound in the wheat and corn markets. Prices on Euronext have rebounded strongly, offsetting some of the downward movement in recent sessions.

In France, harvest conditions remain good as spring approaches. Wheat crops are rated 94% "good to excellent" by FranceAgriMer. Barley crops are improving, with winter barley also considered to be in "good to excellent" condition for 93% of the acreage and spring barley for 99%.

As for the new crop, COCERAL published its new estimates for next season, including the EU and UK, on ​​Friday. The volume of soft wheat production was revised upward from last December's estimates. COCERAL expects a harvest of 144,5 Mt of soft wheat. On the other hand, the estimated volume of corn is expected to decrease to 62,3 Mt, as is that of barley to 59,6 Mt, compared to the December estimate. As for oilseeds, the volume of canola is now estimated at 21,1 Mt.

The end of the week for the American market was marked by a strong recovery of prices on the Chicago stock exchange as in Europe.

Operators remain extremely concerned after Russian statements underlining the need to better control prices in the domestic market after the sharp decline seen. The desire to guarantee an advantageous price for producers on the part of exporters could thus support prices, with the desire to increase the country's intervention stocks remaining on the back burner.

The recent decline in the price of corn sparked sustained selling activity throughout the week, with new sales reported to China on Friday for 204.000 mt. Prices on the Chicago Mercantile Exchange for May 2023 returned above $6,40/bushel for the first time in a month, erasing the downward movement of the past two weeks. The return movement is also observed in the new crop. The recent drop in prices could lead to some revisions to seeding intentions as USDA still estimates a larger area for spring campaigns.

In the case of oilseeds, the downward movement seen earlier in the week saw prices hit new lows on Friday. Futures for May 2023 were trading below $14,20 a barrel, hitting a new high on October 28 last year, before recovering. The progress of the Brazilian crop remains an item to watch, even if there is still a delay in work compared to last season.

Euronext quotes 27.03.2023 (GMT + 1)

Wheat (€/t)

Maize (€/t)

Rape (€/t)

Article written by Gabriela Dan, Editor of Arta Albă.

Read on White Art and: The snack market continues to grow