SovEcon: Russian and global grain market news – February 1, 2024

Daily news and market insights from a leading firm focused on the Black Sea agricultural markets research

On Wednesday, the U.S. wheat prices resumed their decline. The March SRW contract closed at $5.95/bu ($219/mt; -1.7% compared to Tuesday). March French wheat dropped to a new contract low, reaching €210.75/mt ($228/mt; -1.4%). U.S. corn closed at $4.48/bu ($177/mt; +0.1%).

Open interest (OI) in the March SRW contract increased by 1K contracts to 193K on Wednesday. Open interest in the March MATIF wheat contract rose by 9K contracts to 262K.

Corn prices received support from bullish weather expectations in Argentina. A heatwave is expected next week in Argentina’s agricultural regions, followed by rain in the north, south, and west, according to the Buenos Aires Grain Exchange. The exchange’s analysts note that if the rains fail to materialize or are insufficient, corn and soy production forecasts may be lowered.

February’s maximum temperatures are likely to be above normal in most parts of northwestern India, according to Mrutyunjay Mohapatra, Director General of the Indian Meteorological Department (IMD). The high temperatures could adversely affect the harvest and may compel the country to lift restrictions on grain imports.

On January 31, the European Commission proposed to partially restrict imports of Ukrainian food products and supported France’s proposal to extend the suspension of obligations for fallow lands until June 2025. The latter refers to the European Commission’s requirement for farmers to keep about 4% of arable land fallow.

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