Supply weighs heavier than winter on the wheat market

The Ukrainian farmers' union warns that winter wheat and rapeseed in the country will not come through the cold unscathed that has held Ukraine in its grip for a few weeks now. In the US, it will also be really cold this weekend. However, this has only a limited impact on the market. Moderate export figures weigh heavier on trade. To boost exports, the Russian Minister of Agriculture came up with an idea... The March contract for wheat on the Matif closed yesterday unchanged at €189.50 per tonne. On the CBoT, wheat closed 2½ cents lower at $5.07¾ per bushel. Corn lost 2 cents, finishing at $4.21¾ per bushel. Soybeans were up, closing 11½ cents higher at $10.64½ per bushel. The weather reports are gaining more attention in the grain market. In our regions, it is getting a bit colder, but not enough to move the market. That is different in Ukraine. The Ukrainian farmers' union UAC reports that an ice crust and extremely low temperatures in the east, south, and center of Ukraine have likely caused damage to winter wheat and rapeseed. Temperatures down to minus 18 degrees Celsius, freezing rain, and sleet have created a layer of ice on the crops in some areas. An ice layer several centimeters thick that remains for several weeks is not good for wheat or rapeseed, writes the UAC in its weekly report. There is a risk that the cold has caused damage to the crops. The exact extent of the damage will need to become clear in the coming weeks, the union adds. Snow in the USAlso in the US, there is considerable discussion about winter conditions that are being forecast for the upcoming weekend. The cold front is preceded by snow according to weather models. It could cool significantly with temperatures of around 20 degrees below freezing on the southern prairies. The prospect of moisture, even if it comes in the form of snow, seems to weigh more heavily for players in the wheat market than the risk of winter kill. It is very likely that localized frost damage will occur, according to some sources, as the cold is accompanied by quite a bit of wind. Export lagging behindA moderate demand for wheat and ample supplies mean that the upward potential in the wheat market remains limited. The EU exported 11.83 million tonnes of wheat by January 15, as the new export figures from the European Commission show. This puts the export 2% behind last season. Russia is also experiencing an export pace that is not in line with what the Kremlin would like to see. Putin wants to increase the export of agricultural products by 50% by 2030. The Russian Minister of Agriculture, Oksana Lut, said yesterday at a conference for the dairy sector that Russian companies need to set up food processing facilities with government support. It will no longer be possible to win the cooperation of countries simply by supplying raw materials. Therefore, we must come up with investments, Reuters quotes Lut. In contrast to grains, soybeans had more favorable conditions. This is partly due to rain in Brazil. The soybean harvest, which has just begun there, is currently at a standstill. However, a more important factor according to analysts is that China has actually purchased 12 million tonnes of soybeans in the US, as agreed upon with President Trump. Traders are breathing a sigh of relief that the American action in Venezuela and Trump's claim on Greenland did not cause Beijing to pause trade with the US.