Demand for US soybeans gets support from China

The grain markets showed a mixed picture on Tuesday. On the European futures market, wheat and corn moved higher, with logistical problems around the Black Sea especially providing support. In Chicago, the focus was more on U.S. crop expectations. Soybean is benefiting most from that and is also getting support from Chinese demand. The December wheat contract on Euronext closed Tuesday €1.50 higher at €235.75 per tonne, an increase of 0.6%. Chicago showed a correction. The December contract for soft red wheat lost 8 cents and closed at $6.81¼ per bushel. That gave back part of the strong rise from last Friday. The Black Sea remains an important factor for the wheat market. Reciprocal attacks by Russia and Ukraine have limited shipments from the region. Among other places, there are problems around the important Russian export port of Novorossiysk. Still, traders continue to expect that the grain will eventually reach the world market. The supply has not disappeared, but is partly piling up in the ports. For now, that limits the upward room for the wheat price. Logistical tension is also rising on the European side of the Black Sea. Ukraine is turning to Romanian Constanta because shipment from Odessa is not possible due to Russian missiles. The flow of Ukrainian grain to the Romanian seaport clashes with the interests of Romanian farmers and traders. It limits the Romanians in their own exports and pushes export prices there higher. Opposite the problems on the supply side is weak international demand. That keeps wheat trapped between two forces. The risks around the Black Sea provide support, but as long as importers remain cautious and the market expects Russian and Ukrainian stocks to eventually be exported after all, there is no clear reason for prices to rise further. Corn Corn on Euronext continued its advance on Tuesday. The November contract gained €1.25 and closed at €255.75 per tonne. That is the highest level since 27 July. Chicago moved the other way: December corn lost 1.5 cents and ended at $4.88 per bushel. For the European market, attention is clearly shifting to Ukraine. Sales of the new Ukrainian corn crop are already well advanced, but available rail and transshipment capacity is becoming a growing bottleneck. On various routes, capacity is, according to some market participants, practically fully booked until the end of 2026. Dutch imports of Ukrainian corn are also increasingly experiencing disruption from this. In the United States, the focus is meanwhile mainly on the size of the coming crop. Yield expectations are being revised downward. That gives corn support from two sides: doubts about U.S. yields and logistical constraints for Ukrainian grain. Soybean Soybean is currently the strongest of the three markets. In Chicago, the price rose further on Tuesday to $12.16¾ per bushel for November. Lower crop expectations in the U.S. are an important driver. Equally important is the demand side. New purchases from China are providing support. According to traders, China has now secured more than 7 million tonnes of U.S. soybeans. Domestic processing also remains strong.