Market Overview
Wheat/Barley
Despite reports of escalating conflict between Russia and Ukraine, the Black Sea Grain Corridor was renewed last week for another 60 days.
Global Wheat prices have been under pressure for most of the week, with the deal being extended to 17th July 2023.
Newly released crop reports show continuing good crop conditions in much of Europe. However there are areas of concern in Spain, Portugal and North Africa due to drought conditions.
In the latest WASDE report, the UK is projected to produce 15.5MT of wheat for 2023/2024. Although slightly down from last year, a large carry over of old crop stocks is expected into the next crop year. Reports suggest arable farms in England and Wales have stored 17% more wheat and 26% more barley on farm during the first quarter of 2023 than the previous year.
Barley continues to track the wider grain complex. UK planting is reported to be down 6% year on year and 10% down on production. The global 2023/2024 crop is estimated at 147.4MT, down 4.6MT year on year.
Maize
Favourable weather in the US has given support to fast maize plantings. The US maize crop was at 81% planted as of Sunday, ahead of the five year average of 75%.
Forecasts for a record Brazilian 2023/2024 Safrinha crop and a large 2023/2034 US crop have been weighing on the market.
Reports suggest China has cancelled 272KT of US maize imports, the fourth cancellation in the past month.
In the May WASDE report, the USDA estimates Ukraine’s maize production at 22MT in 2023/2024, down 19% year on year. They also estimate that Ukraine’s maize exports will be down by 35%.
Hi Pro Soya/Rapemeal
US soybean planting is estimated at 66% complete as of 21st May. The second fastest based on the past 5 years. The news on planting progression with projections for a record US soybean crop of 122MT has been pressuring markets.
The record Brazil soybean crop is now filtering into the market. Private Brazilian forecasters have revised their estimates for the 2022/2023 soybean crop up to a record 155.33MT.
This has offset the USDA cuts to Argentina’s soybean crop to 27MT, Argentinian harvest is at 52% complete, well behind the 74% average pace.
The USDA projects 2023/2024 world rapeseed supplies at 87.1MT. This is the second largest world rapeseed production in a row.
Large EU opening stocks & EU Production continue to pressure prices. However until new crop supplies arrive in August, rapemeal stocks could become tight and reflect in domestic prices.
