Wheat and corn prices are rising amid the protracted war in Ukraine

There are no hopes of stopping Russia’s war against Ukraine through negotiations. Russia cannot name the cause of the attack, but the world has already realized that “denazification” means the complete physical destruction of the Ukrainian people. That is why all Ukrainians defend their country together, and civilized countries help them in every possible way.

Markets are sensitive to news from the Ukrainian fronts. There is a growing understanding that the world needs a complete victory over a country that kills civilians to satisfy its ideas of capturing other free countries. The realization that the war will continue for more than a month puts pressure on the wheat and corn markets, whose supplies from Ukraine are completely blocked and from Russia are limited due to the refusal of many countries to cooperate with the aggressor.

Since Monday, world prices for wheat and corn have risen by 4-5% due to the lack of prospects for the resumption of supplies from major exporting countries. However, traders do not risk buying expensive long futures, because in the event of an end to the war, grain prices will fall sharply.

May futures in the US rose yesterday:

• 5.2% or $ 20.4 / t to $ 411.3 / t for soft winter SRW wheat in Chicago,
• 4% or $ 15.7 / t to $ 409 / t for winter winter HRW wheat in Kansas City,
• 2.7% or $ 10.47 / t to $ 400 / t for durum HRS wheat in Minneapolis,
• by 1.8% or $ 7.25 / t to $ 400.75 / t for Black Sea wheat in Chicago.

According to the NASS USDA, winter wheat crops in the United States suffer from a shortage of rainfall. For example, in Kansas, the number of crops in good or excellent condition rose to 25% during the week, on average to 36%, while in Texas and Oklahoma the condition of crops deteriorated. According to forecasts this week, more than 30 mm of precipitation will fall in the regions of winter wheat cultivation, which will accelerate the vegetation of plants.

Wheat exports from the United States for the week of March 11-17 rose by 5% to 330.6 thousand tons, but buyers are in no hurry to buy expensive wheat, hoping to reduce prices after the war.

• May futures for European wheat on Paris’ Euronext yesterday rose 4.1% or 15 € / t to 376.75 € / t or 413.74 $ / t.

The Argentine government has announced an increase in the annual quota for wheat exports in 2022/23 MY by 8 million tons to 10 million tons to take advantage of high world prices, while the quota for 2021/22 MY was 14.5 million tons.

May corn futures in the US yesterday rose 2% to $ 297.7 / t following oil prices. As of March 20, corn has sown 42% of the area, up 5% from last year’s rate and 7% above the 5-year average.

Exports of corn from the United States for the week increased by 28% to 1.466 million tons, and in total in the season amounted to 27.18 million tons (from the projected 63.5 million tons), which is 17.6% lower than last year.

Demand prices for Ukrainian corn with delivery to the western border fell to $ 260 / t DAP. There are significant logistical problems due to the lack of infrastructure to supply large consignments. Domestic prices for food wheat in Ukraine fell to 7500-7700 UAH / t with delivery to the mill due to low demand for flour and increased supply.

GrainTrade 

Tags: wheat, war, Ukraine, corn, prices