March 15th

Market Report

The week starts with renewed interest from international buyers. Despite the current price levels, several tenders are in place for cereals. Turkey is positioning itself to purchase 270,000 t of soft wheat. Algeria is also looking for feed barley. These requests are in addition to the current calls for tender in a context of firm prices.

The Russian announcements of setting up export restrictions have raised many questions about the products and destinations concerned. Russia would seek to contain the flow of exports to certain neighboring countries while guaranteeing the flow of business already contracted through its quota mechanism in place. This type of announcement has above all made the market nervous and has added incomprehension to the current confusion about Russian export activity. Indeed, market operators quickly integrated this announcement as a generalized export ban whereas the destinations concerned only concern the countries of the Eurasian Economic Union. This announcement has led Euronext prices to show a new firmness, especially on the near term, recording a session with a wide range of variation.

For the current season, corn prices have fallen slightly, as have rapeseed prices. The decline in oil prices, back below $100/b, erased the upward movement observed since the beginning of the month. In palm oil, the Kuala Lumpur market is also retracing its downward trend after the recent highs traded last week.

American market
The USDA reported yesterday a new corn sale on the 2021/2022 crop year to Mexico for a volume of 159,000 t. Despite active demand, corn prices in Chicago for the May 2022 contract have remained contained in the $7.40/$7.65/b range for the past week. Despite testing the resistance zone several times, prices have not yet managed to break out of this range. In terms of export activity, weekly corn shipments out of the US are slightly down from the previous week, but still above 1.14 Mt in the low range of expectations. Currently, to meet close needs, U.S. corn ships are being loaded for Italy and Spain.

The soybean market after showing some firmness at the beginning of the session finally closed lower in Chicago. The new export authorization mechanism announced in Argentina for soybean oil and meal, with an increase in taxes, creates a new constraint for Argentine exporters.

Wheat prices, after having risen sharply at the beginning of the session in the face of the prospect of Russian export restrictions, were finally little changed from the previous day at the end of the day. Nevertheless, winter wheat crop conditions, still dry in many areas, are causing crop ratings to deteriorate again in Kansas and Texas. Crops rated in "good to excellent" condition represent just 23% and 18% of acreage in these two states, respectively. Rains are eagerly awaited to improve the situation.