February 23rd

Market Report

The markets reacted strongly to the situation in Ukraine by showing their nervousness. Wheat and corn prices on Euronext progressed between + 4 and + 5 € / t while the rapeseed soared to more than 729 € / t for the 2021 harvest, and more than 635 € / t for 2022 harvest.The economic sanctions against Russia will have multiple consequences, both for the flows of the Black Sea basin, as well as on energy costs for Europe, with a probable disruption of gas supplies from Russia. This is what we have seen with Germany vetoing for the moment its supply through the Nord Stream 2 network.
On the international scene, the US sold yesterday 132,000 t of soybeans to China and 120,000 t of hard wheat to Nigeria. Turkey is also reported to have purchased about 255,000 t of feed barley from optional origins.
The European Union exported 17.68 million tons of soft wheat as of February 20, compared to 17.25 million tons last year to date. Barley exports stood at 5.17 million tonnes compared to 5.04 million tonnes last year. Finally, maize imports are at 10.55 million tonnes, down from 10.79 million tonnes last year.
Rapeseed imports at the European level are posted on February 20 at 3.23 million tons against 4.39 million last year to date.
Rapeseed closed very high yesterday, in the wake of all vegetable oils. Indeed, Ukraine and Russia are the two largest producers of sunflower in the world and the impact of oil exports limitation is stretching a world market already under the influence of palm prices, (which are posting a new record every day).

American market
Very strong rise in prices of all products on Chicago yesterday, considering the geopolitics inviting itself in the mind of the traders. This pressure is added to those on the upcoming harvests in South America in soybean and corn, given the persistent hydric deficit.
International traders fear logistical difficulties in the Black Sea basin due to the situation, with a consequent sharp rise in freight and insurance costs. In the north of Brazil, in the state of Mato Grosso, rains are hampering harvesting operations, while the south of the country remains plagued by a water deficit.
Export inspections amounted to 1,576,666 tons of corn, at the top of the range of expectations. Soybean inspections, however, were a bit disappointing at 975,102 MT.
According to Ag Rural, the soybean crop in Brazil is expected to be 33% complete compared to 15% last year to date. The second crop corn (safrina) is sown at 53% compared to 24% last year.
Very strong activity on the fund side yesterday, with net buyers for 23,500 lots of corn, 18,500 lots of soybeans and 19,000 lots of corn.