The weather makes a world of difference in South America

The demand for grains remains a sensitive issue in the market. Ukraine does not intend to impose any restrictions on wheat exports this season. The country is on the optimistic side in the export forecast. The USDA announced that China has again purchased a significant volume of soy from the U.S. Meanwhile, Europe is struggling to get the export statistics in order. Brazil could achieve a record soybean harvest this season, while just a bit further south, Argentina is facing flooding. The December contract for wheat on the Matif closed yesterday €0.50 lower at €190.25 per ton. At the CBoT, wheat took a harder hit. Wheat lost 9¾ cents on the Chicago exchange, settling at $5.36¾ per bushel. Corn closed 7 cents lower at $4.29¾ per bushel. Soybeans rose earlier this week to the highest point since 2024. Yesterday, there was a correction, and soybeans lost 17¼ cents to close at $11.36¼ per bushel. Ukraine will not impose any restrictions on wheat exports this season. At least that is what the Ukrainian Minister of Economic Affairs expects. The Ukrainian wheat harvest is estimated by the country itself at 23 million tons, which is the same figure as the USDA's. The USDA estimates Ukrainian wheat exports at 15 million tons while Ukraine itself anticipates an export of 17 million tons. In 2024, Ukraine harvested 22.6 million tons of wheat, of which 15.7 million tons were exported. So far this season, 6.8 million tons of wheat have been exported from Ukraine compared to 8.6 million tons during the same period last season. Viewed this way, the Ukrainian export forecast may indeed be a bit on the optimistic side. Mess European wheat exports have made significant progress. As of November 16, 9.05 million tons of wheat have been exported compared to 9.09 million tons last season. In the data, the European Commission notes that France’s figures have been incomplete since the beginning of 2024, those from Bulgaria and Ireland since the start of the 2023/24 season, and that Polish import and export data from the last two months are missing. The European Commission is also investigating the unusually large wheat exports from Romania. Various analysts criticize the European Commission for the prolonged issues with data collection. In the background, the American president seems to want to make a new attempt to achieve peace between Russia and Ukraine. Various media report based on anonymous sources that high-ranking officials within Trump’s administration have been in Ukraine to discuss an end to the war. The Kremlin has reportedly indicated that it is open to a deal. The Kremlin's spokesperson, Dmitri Peskov, denies that there are any new developments. In another headache for Trump, the trade war with China, the USDA came out with positive news. China has bought 330,000 tons of soy from the U.S. for delivery this season. Through official channels, the export of 1.1 million tons of soy to China has now been confirmed. There is still significant work to be done before China hits the 12 million tons that Beijing, according to Trump, needs to import in the 2025/26 season. Extremes In South America, the contrast between Brazil and Argentina regarding the course of the season is significant. In Brazil, the weather is relatively dry, which has delayed soybean planting. However, it is not extremely dry in the country. Abiove, the Brazilian industry association for the vegetable oil sector, itself anticipates a record soybean harvest. The harvest for 2026 is estimated at 177.7 million tons compared to 172.1 million tons last year. Of this, the Abiove forecast estimates 111 million tons will be exported. For 2025, Abiove expects an export of 109 million tons. In Argentina, there is no drought, but there is local waterlogging. In some regions, more than double the amount of rain has fallen this year compared to the multi-year average. Around this time, everyone should be out in the fields with the seeders, but now it is too wet or even waterlogged in the plots, farmers report in local media. Due to a lack of maintenance and insufficient investment in drainage and water management infrastructure, the problems caused by the excessive rain are exacerbated. According to the Buenos Aires exchange, 12.9% of the planned soybean area has been planted, compared to 16.2% of the five-year average.