Russians are planting less wheat due to low prices

Wheat is not exactly the most profitable crop for most farmers. When prices are also moderate, as is currently the case, there is nothing left of a wheat balance. This problem is not exclusive to the Netherlands. In Russia, grain growers are also looking for alternatives to wheat. The USDA did not release the Wasde report due to disagreements over the budget of the US government, and the usual export figures are also missing. A support program for soybean farmers, who are struggling due to the trade war, is also on hold. The December wheat contract on the Matif closed yesterday €2.50 higher at €190.50 per ton. On the CBoT, wheat took a small step back and closed ¾ cent lower at $5.06½ per bushel. Corn closed 3¾ cent lower at $4.18¼ per bushel. Soybeans were also in the red, closing 7¼ cent lower at $10.22¼ per bushel. That wheat yields little to nothing for a farmer is not an exclusive Dutch problem. Russian farmers are also looking for an alternative to winter wheat. According to the Russian Deputy Minister of Agriculture, Russian farmers are planting 6.2% less winter wheat than last season. The total area of winter wheat in Russia amounts to 28.2 million hectares. The reason for the decrease in area, as mentioned, is the moderate financial return from the crop. Instead of wheat, Russian farmers see more value in cultivating oilseeds, according to the deputy minister. Record harvest in Argentina Argentina is heading for a record wheat harvest this season. At least, that's what the Rosario stock exchange expects. They have raised their harvest forecast by 3 million tons to 23 million tons. Market agency Expana came out with new figures on the wheat harvest in the EU. They have revised European wheat production upwards by 300,000 tons to 136.4 million tons. However, this is still below the latest USDA forecast, which estimated a European harvest of 140 million tons. According to the schedule, the USDA would release the October edition of the Wasde report yesterday. Due to the US government shutdown, this report (like the Crop Progress and export figures) has been suspended until further notice. Drought area expands The drought monitor has indeed come out this week. It shows that the drought in the Corn Belt is expanding. Of the corn area in the US, 31% is now in a drought area, compared to 28% last week. While the dry weather is pleasant for the corn and soybean harvest, the crops that are not yet ripe are becoming emergency ripe, as several local sources report. Another contentious issue for American agriculture remains the trade conflict with China. China has now introduced a system of export licenses for the export of rare metals. Peking claims to do this in the interest of national security, but various analysts believe that China wants to send a signal to US President Trump. Later this month, a meeting between Trump and Xi is scheduled in South Korea, and leading up to that summit, Trump has already said a few things about soybean exports to China. For American farmers, who are somewhat caught in Trump’s geopolitical game, the US government is working on a support program. However, due to the shutdown, this program is on hold, as Agriculture Secretary Rollins mentioned yesterday. Meanwhile, farmers are holding their recently harvested soybeans in anticipation of what will come out of the USDA in the near future, as some American sources suggest.