Wheat yield in Australia is nothing to complain about

The grain market felt a bit friendlier for sellers during the last trading session. A few large purchases improved confidence. The war in Ukraine continues to cause considerable uncertainty. Players in the grain market still show little confidence in the peace plans for Ukraine and Russia. A factor putting some price pressure is the progress of the harvest in Australia and Argentina. The wheat there is doing well this season. The December wheat contract on the Matif closed yesterday €0.50 higher at €189.25 per ton. Also on the CBoT, grains closed in the green. Wheat rose 1¾ cents to $5.29 per bushel. More convincing was the rise of corn, up 8¼ cents to $4.31¾ per bushel. Soybeans were somewhat between the grains with an increase of 6¾ cents to $11.31½ per bushel. Demand for grains created a somewhat more positive mood on the futures markets in the last trading session. According to various sources, the Turkish state purchasing organization TMO has bought 300,000 tons of milling wheat. Reportedly, it concerns wheat from Russia, and TMO did not purchase through a tender process but with a direct deal. South Korea has also secured a reasonable volume of wheat. A wheat processor has bought 91,000 metric tons of wheat in the US. Another Korean company has purchased 40,000 metric tons of spring wheat in Canada. No prices have been disclosed for the order in the US, but for the wheat from Canada, $260 per ton FOB (delivered on the ship) was paid for delivery in March/April. Keeping commitmentsChina has bought ten shiploads of soybeans in the US since Tuesday. This occurred after a phone call between Trump and Xi. The American president urged his Chinese counterpart to import more from the US. Xi agreed to some extent. According to sources, the soybean purchases would be worth about $300 million. The soybeans from the US are somewhat more expensive than those from Brazil. There is talk of a premium of $0.50 per bushel for North American soybeans compared to Brazil. Some analysts view this as a nice gesture from China just before Thanksgiving (which is celebrated today in the US). Since the end of October, China has bought about 3.5 million metric tons of soybeans in the US. For the 2025/26 season, China has agreed, according to Trump, to buy 12 million metric tons of soybeans. This commitment has thus been fulfilled by about 30%. Peace is still far awaySomewhat closer to us, the war in Ukraine continues to cause unrest in the grain market. A generous availability of grain in Russia and Ukraine creates a certain ceiling in the market. We saw this earlier in the week in the tenders from Saudi Arabia. However, these grains need to be transportable to the consumers. That could become more of a crunch. Russia and Ukraine are conducting targeted attacks on infrastructure. Especially Russia's attacks on Ukrainian railways cause problems in grain transportation, warnings are issued from Ukraine. While there is talk of a ceasefire or peace between Russia and Ukraine, it is doubted whether the proposal, where the Americans have taken a bit of the lead, will materialize. In the southern hemisphere, the wheat harvest is underway. Both in Australia and Argentina, the combines are operating in the wheat fields. The Rosario grain exchange expects a record wheat harvest in Argentina of 24.5 million metric tons. The Australian wheat harvest is not breaking any records yet, but as the harvest progresses, local sources report that the yields are excellent. Estimates of the total wheat harvest range from 34.5 to 37 million metric tons.