Rainfall in the US and drought in South America weighed on grain markets this week

Mild temperatures with intermittent rains in the US, Canada and the EU are helping seeding and crop development, while drought in Argentina has not only reduced soybean and corn production, but is also impairing winter wheat crop potential. The dry season has also begun in Brazil, but moisture reserves are sufficient for the normal development of crops.

In the corn belt of the United States , particularly in the dry western regions, heavy rains will pass in the next few days, which will allow to accelerate planting next week. Heavy rains are coming in the west and south of the Central and Southern Plains, which will improve the condition of crops. Precipitation will taper off next week, but rain could continue in Texas.

In the prairies of Canada , heavy rains have been falling for a week, replenishing soil moisture reserves. Next week, dry weather with moderate temperatures will accelerate sowing.

In Brazil, the dry season began, and in the central regions the temperatures reached the usual 30-33 ^o C for this period, so the soil moisture in the corn crops of the second harvest decreased slightly. Forecasts for the soybean harvest remain at 154-155 million tons, and for corn – 125-130 million tons, and the USDA will update its estimates today.

A drought continues in Argentina , which prevents the sowing and rooting of winter wheat. Soy has already been harvested on 51.6%, and corn on 21.2% of the area. The Rosario Stock Exchange lowered its forecast for the country’s soybean crop by 1.5 million tons to 21.5 million tons, while the USDA estimated it at 27 million tons in April.

In the EU countries, favorable weather for crops prevails with periodic precipitation, although low temperatures slow down the development of plants. In Spain, drought continues to worsen crop prospects.

Stratégie Grains experts in the May report raised the forecast for the production of soft wheat in the EU in 2023/24 MY by 1.1 million tons to 130 million tons (125.2 million tons in 2022/23 MY), however, due to the drought in Spain, the production forecast barley in the EU decreased by 1.7 million tons to 49.9 (51.2) million tons, in particular, winter – to 28.7 (27.7) million tons, spring – to 21.3 (23.5) million t Maize production forecast lowered by 0.6 million t to 62.1 million t as wet and cold weather delays planting and may reduce yield potential.

Cool weather with below-normal temperatures remains in the Black Sea region, but a decrease in precipitation intensity will allow spring crop sowing to be accelerated.

In Ukraine, as of May 11, 66% of the planned areas were sown with hot crops. Next week, dry and cool weather will allow active sowing.

Tags: grain, Brazil, EU, Canada, USA, crop condition, Argentina