There was some positivity in grain markets this week. As temperatures reached record highs in Europe and France in particular this week, drought and moisture stress had some impact on markets.
Agritel reported this week that the rise in maize prices was helping markets.
“The fears are rising among the operators, with hot weather persisting in France. The strong decline in areas in France and eastern Europe is added to these potential losses, which naturally contributes to the firmness of prices,” it said.
Harvest is under way in the country. Up to 15 June, 4% of the winter barley had been harvested in France.
Last week, the December French wheat price closed at €208.50/t. On Monday, it climbed to €213.25/t and moved to €212.50/t on Tuesday night. They are dried prices.
French corn prices climbed from 15 to 22 June, from €203.25/t to €219.25/t. It dropped €1/t on Tuesday. The dry weather is affecting the corn crop. US wheat and corn fell since the end of last week to Tuesday.
Crop monitoring
The EU released its crop monitoring in Europe report this week. Drought is the main concern and how it will impact on winter and now spring crop yields, as soil moisture reserves are reported to be reduced in several regions.
In central and western France, the hot weather of May and low soil moisture levels reduced winter crop yield expectations.
In southern Czechia, western Slovakia, most of Hungary and westernmost Romania, the report said: “Prolonged dryness and reduced soil moisture availability have negatively affected winter crop development, reducing yield expectations. Although recent rainfall partly alleviated the soil water deficit, summer crops may soon suffer from the forecast hot and dry weather.”
Western and central Ukraine has reduced winter crop yield expectations due to dryness.
On southwestern Germany and easternmost France, the report said: “Low soil moisture levels, combined with forecast heat and limited rainfall, raise concerns for summer crops, particularly maize and sugar beet. Winter crops are less exposed, as they are already approaching maturity.”
This week, the EU allocated emergency support to farmers in Portugal, Romania, Cyprus, Croatia and Slovenia for extreme weather events such as heavy rain, drought and frost.
Oilseed rape
Oilseed rape climbed since 19 June when it was at €510.75/t. On Tuesday evening, it hit €522.50/t. It is a crop that appears to be less affected by drought, but is hit by the war in the Middle East.
On 1 July, Indonesia is to introduce its mandate to blend 50% palm-oil based biodiesel and 50% conventional diesel. This should help to drive prices in oilseed markets.