SovEcon: Russian and global grain market news – March 18, 2024

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

On Friday, U.S. wheat futures continued to decline. The May SRW contract closed at $5.28/bushel ($194/mt; -0.7% compared to Thursday). Euronext wheat prices rose to €195.00/mt ($212/mt; +0.5%). U.S. corn closed at $4.37/bushel ($172/mt; +0.7%).

Funds’ selling could have pressured wheat prices. The open interest for the May wheat contract increased by 1,500 contracts to 201,900 on Friday. Corn prices rose due to new U.S. sales. The USDA reported sales of 125,000 metric tons of corn to unknown destinations. On Thursday, 100,000 metric tons of corn were sold to Mexico.

The European Commission officially announced plans to “restrict the import of agricultural products from Russia into the EU.” The work on preparing restrictive measures is mentioned in a statement issued by European Commission President Ursula von der Leyen. Earlier, European journalists, citing sources, reported plans to limit Russian exports.

On March 15, Odessa suffered the most extensive attack in weeks. According to local administration reports, a missile strike killed 20 people and injured 70. On the night of March 17, Odessa was under a drone attack during which two “mothballed agribusinesses” and some industrial buildings were damaged.

The condition of 66% of French wheat crops is rated as good or excellent, according to FranceAgriMer. This is the lowest figure since 2020 when 63% of crops were in good/excellent condition.

Dryer than normal weather conditions were recorded over 72% of the U.S. Midwest last week, reports the U.S. Drought Monitor. This is the highest figure for mid-March since 2003.

Polish farmers have been blocking the Chyżne checkpoint on the border with Slovakia since March 15. The protesters plan to check trucks passing through the border for re-export of Ukrainian grain. Similar measures were previously implemented on the border with Lithuania, but the media did not report any instances of re-export.

The El Niño weather phenomenon is expected to end this spring, after which there is a 62% chance of La Niña beginning, reports the U.S. Climate Prediction Center of the National Weather Service. Earlier, local exchanges Rosario and BAGE reported a high probability of the return of the weather phenomenon associated with a moisture deficit in Argentina.

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