- European grain markets followed their downward trend of last week closing lower again today with old crop July hitting prices not seen since last June. Nerves failed on news from IKAR (Russia’s Institute for Agri Studies) that the Russian crop would reach nearly 54 million mt, marginally less than latest USDA estimated at 56 million mt, and significantly above last year’s drought hit 37.7 million mt. Whilst southern Russia still suffers from dry conditions, Krasnodar, one of the key regions, has benefitted from recent rains. Latest weather forecasts suggest further rain and, as we all know, “rain makes grain”, and that is how the market has reacted today.
- It must be borne in mind that the UK harvest is expected to be around three weeks late as a consequence of late planting, winter wetness and cold. The knock on effect will be to increase the demands upon old crop supplies by maybe three weeks, as a result we could well see a price surprise in the offing, particularly if weather here does not improve significantly – and soon.
- US crop progress figures, including planting data, will be released later today, and it is widely expected that corn planting will see a significant jump with some suggesting as much as 65-70% could well now be in the ground. We will get the figures at 21:00 UK time today.