July 22nd

Market report

Yesterday was a busy day for news and price changes. On the economic front, the ECB raised rates by +50 basis points. The main interest rate is now 0.50% while the rate on excess bank liquidity is at 0% after a long period in negative territory. Further adjustments are expected until the end of the year. The eurodollar is little changed, and is trading around 1.02. In Christine Lagarde's speech, market participants noted the risk of a deterioration of the economic situation in the second half of 2022.

On the cereals front, the IGC released its new production estimates yesterday, raising world production by 1 Mt to 770 Mt and increasing consumption by the same volume. Wheat export activity remains at 194 Mt, unchanged from the June estimates. The harvest period is currently conducive to a dynamic export business. New additional purchases from Egypt, as well as further interest from importing countries, were reported yesterday, bringinga support during the session. Prices on Euronext rose back to last week's levels. Operators are now paying close attention to the conclusions of the meeting scheduled for today in Turkey between Russia and Ukraine. An agreement could be reached with the reopening of Ukrainian ports to exports.

The ongoing downward movement in the rapeseed market led to a further decline in prices yesterday. The approach of the August 2022 expiry next week is also pushing some players to clear their positions. The price of the nearby maturity came close to 600 €/t at the beginning of the session on Euronext and finally recovered during the day to close above 620 €/t.

American market
Soybean and corn markets fell back again yesterday, testing important technical areas. Soybean prices on the November 2022 maturity are trading back down to the $13/b level, the lowest in 6 months. In corn, the situation is similar after yesterday's break of the $5.80/b support. The downward movement is mainly linked to the improvement in weather conditions that will improve crop development. A return of rain and a decrease of temperatures is expected.

The prospect of a deal between Russia and Ukraine on Black Sea export corridors has been announced late yesterday. Chicago wheat prices declined on the back of it. Weekly US export sales figures provided little support despite a decent 511,100 tonnes of wheat, this figure was in line with expectations.