International grain futures markets were a bit mixed over the Christmas period but they have picked up considerably since then.

Chicago maize prices fell as low as $3.944/bushel but they increased to $4.046 by the start of the second week in January.

Wheat prices fell as low as $5.41/bushel post Christmas to push as high as $5.56/bushel on 8 January.

Prices in the EU were little changed, however, but there was a slight improvement in maize prices into the new year.

Price drivers

There were obviously a number of bullish factors in the market in recent days which mainly affected US market prospects.

There has been increasing concern over the quality of both wheat and maize in Argentina and Brazil as a result of weather conditions in those countries.

Wet has been a significant problem in Argentina, giving rise to concerns for both crop losses and grain quality.

The problems being encountered in Brazil are the opposite, where dryness has been a major threat to the development of maize crops there.

And with weather conditions forecast to remain broadly similar in these South America countries for the next two weeks or so, the weather factors are likely to have some short- to medium-term impact in international grain markets.

These issues affect supply and market access for south American grains but they may also open up opportunities for US exports where prices are rising as a consequence.

This, combined with the fact that US cash prices now seem to be competitive with Russian export prices, has acted to further boost global wheat prices. These moves also appear to have increased interest in US wheat for export.

The Chicago price trends for maize, wheat and soya beans are shown in the graphs below.

Proteins

Staying with Chicago, November soya bean futures dropped to $9.234/bushel around Christmas but bounced back above $9.6/bushel by 8 January although it may not hold at that level.

It seem that the resumption of talks between the US and China on trade issues has continues to add a level of confidence to the market, for the moment at least.

It seems that the US optimism is also helping nearby MATIF oilseed rape prices slightly also. New crop futures prices for CBOT soya bean and Euronext MATIF oilseed rape can be seen in each of the graphs.

Reports that China has resumed purchases of US soya beans since December are helping oilseed price sentiment.

So are reports that the continuing dry conditions in Brazil are causing yield losses to decrease overall global supply.