Grain Market Daily



Alice Bailey, Analyst, AHDB Market Intelligence, 02476 478840



Global Weather Roundup

Although trade disputes have certainly had an effect on markets recently, weather will remain a key watch point.

US – Unfavourable

Rainfall in the Mid-West is causing delays in corn and soyabean planting. Monday’s USDA crop progress report gave (as at 12 May) corn planting 36% behind the 5 year average and soyabeans 20% behind. This caused an upward turn in the markets this week which may continue if rainfall lingers and investment funds reduce large short positions.

Corn planting delays have led to rumours that higher acreage of soyabeans could be seen due to the later planting dates. This, along with the US-China trade dispute seemed to be weighing on the soyabean market last week.

If the trade dispute continues, US soyabean stocks will heavily weigh on the market, likely bringing a return of the bearish trend and possibly preventing extra acreage being put to soyabeans.

Europe - Favourable

Dryness concerns have been alleviated somewhat in the past week with reasonable rains experienced across most of Europe. Subsurface soil moistures have been recorded as wetter than normal, creating good crop conditions. The expectation for 2019 wheat production is at a four year high currently. Oilseed rape on the other hand is expected to be down from last year with lower areas planted due to unfavourable winter planting conditions.

Ukraine – Very Favourable

This week, UkrAgro Consult have reported that winter and early spring grains are developed 5-7 days ahead of the long-term average. April saw rainfall at 95% of normal and no significant temperature extremes resulting in excellent conditions. The favourable weather has increased expectations of both wheat and oilseed rape crops for 2019 in Ukraine.

Russia – Favourable

Russian soil moistures are slightly down on average according to the USDA crop explorer data, however production prospects are currently quite high. The wheat crop is forecast to be the second highest on record for 2019 at 77Mt.  Whilst expectations are high, we’ll need to monitor the dryness concerns in southern regions if rainfall doesn’t arrive before summer heat starts to build.

Australia – One to watch

Currently, planting for the 2019/20 harvest is underway and with little rainfall across cropping regions. There could be delays in planting or farmers could be pushed to plant into dryness causing yield concerns. To further hamper production prospects, ABARES has predicted June to be hotter and drier than normal. On the back of this, it is unlikely that the earlier prediction from Australia’s official commodity forecaster for a 40% jump in production will come to light.

Australia has experienced prolonged drought since 2016. This has had a huge effect on production with a significant drop of 30% in wheat production in 2018/19. It was announced this week, that Australia is due to import a shipment of wheat from Canada to make up the shortfall. 


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