In the past week, grain markets did not undergo a clear development, despite the incoming data of a disappointing harvest of corn and sunflower in Europe. Against this backdrop, Turkey has once again taxed sunflower imports into the country to relieve domestic producers.
Don’t have time to read the entire market report? Here’s what you need to know:
How did the EC react to the protest? – "your request will be examined and analysed, despite our expectations that the situation will normalise...", are the words of European Commissioner Janusz Wojciechowski.
Russia in anticipation of the new harvest - the advance of harvesting has caused a number of European countries to revise their export forecasts due to the competitiveness of grain crops of Russian origin.
More insights in this week’s report for our paid subscribers:
What affects prices? – we are witnessing a situation in which not the usual factors (quantity and quality of production, demand and supply, etc.) but political decisions influence the price of grain.
Europe vs. Europe – Farmers from Poland, Romania, Bulgaria and France protested against imports of cheaper Ukrainian grain and poultry, which lowers prices and is competing for space at local ports.
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In Bulgaria, grain producers from Dobrich, Vidin, Montana and other cities in the country protested against the unregulated import of grain from Ukraine, as well as against some of the requirements under the Green Deal.
In response to popular discontent, our country asked the European Commission to implement extraordinary measures due to the disturbances on the grain market.
At the meeting organised by the European Commission in Prague, the acting Deputy Minister of Agriculture Georgi Sabev said: "...in the current situation of market and price volatility, it should be ensured that the measures taken to mitigate the effects of the hot war now taking place in Europe do not undermine the competitiveness and viability of key sectors for European agriculture".
Is Europe looking at Ukrainian exports?
The European response was cold and terse and came from Commissioner Janusz Wojciechowski: “Your request will be considered and analysed, despite our expectations that the situation will normalise after the opening of the processing industry in Ukraine.”
In the Black Sea region, a growing Russian harvest has prompted a number of European countries to revise their export forecasts. France AgriMer revised its forecast for wheat exports to third countries down to 10 million tonnes from 10.3 million tonnes in July, due to the competitiveness of the grain crops of Russian origin.
On the Old Continent, Coceral revised its estimate for EU corn production down to just 51.9 million tonnes versus 66 million tonnes estimated in May. Soft wheat production is now estimated at 140.5 million tonnes compared to 143.4 million tonnes last year.
Ending stocks are slightly different, now estimated at 2.36 million tonnes compared to 2.34 million tonnes in July, with forage consumption increasing to 4.4 million tonnes as a result of its competitiveness against corn. For barley, end-of-season stocks for 2022/23 are estimated at 1.66 million tonnes, compared with 1.56 million tonnes estimated in July.
An increase was observed in the import of rapeseed oil in the EU. The EU imported 1.16 million tonnes of rapeseed as of 11 September, up from 830,570 tonnes last year to date.
Overseas, at the beginning of the week the dollar once again regained ground against the European currency at a level of 0.9995 per euro. Oil prices remained slightly volatile, with a barrel trading at $85.55 on the New York Stock Exchange on Monday morning.
In the US, weekly corn exports were nearly 583,100 tonnes, in line with expectations. Wheat exports remained somewhat disappointing - 217,300 tonnes. Soybean exports continued to move at a steady pace, at around 843,000 tonnes.
In Argentina, the upcoming wheat harvest may be lower than expected, as a result of the drought that has hit the country in recent weeks.
Canada expects records
StatCan released its forecast for Canada's whole wheat crop which amounts to 34.7 million tonnes, up from 22.3 million tonnes last year, with durum wheat production estimated at 6.1 million tonnes, which is about twice more than last year. Rapeseed production is estimated at 19.1 million tonnes compared to 13.8 million tonnes a year ago.
World markets
Futures by the 20th of September
| Wheat | |||
| Data |
Chicago 12. 2022 (per/tonne) |
London 11. 2022 (per/tonne) |
Paris 12. 2022 (per/tonne) |
| 14.09 |
$ 320,46 |
£ 277,15 |
€ 337,25 |
| 15.09 |
$ 310,45 |
£ 273,00 |
€ 332,50 |
| 16.09 |
$ 311,25 |
£ 271,35 |
€ 334,25 |
| 19.09 |
$ 313,20 |
£ 270,95 |
€ 329,25 |
| 20.09 |
$ 309,75 |
£ 271,25 |
€ 328,85 |
| Corn | |||
| Data |
Chicago 12. 2022 (per/tonne) |
Paris 11. 2022 (per/tonne) |
|
| 14.09 |
$ 268,60 |
€ 331,00 |
|
| 15.09 |
$ 266,73 |
€ 329,00 |
|
| 16.09 |
$ 265,00 |
€ 328,25 |
|
| 19.09 |
$ 266,20 |
€ 326,00 |
|
| 20.09 |
$ 265,80 |
€ 324,00 |
|
Source: Euronext, CME, ICE
The real market in Agriniser
Trending prices according to negotiations in the platform| Feed wheat | Corn | |
| Region | Price excl VAT | Price excl VAT |
| North-West | 613 bgn/t. | 592 bgn/t. |
| North Central | 614 bgn/t. | 596 bgn/t. |
| North-East | 623 bgn/t. | 605 bgn/t. |
| South-East | 621 bgn/t. | 603 bgn/t. |
| South Central | 616 bgn/t. | 597 bgn/t. |
| South-West | 615 bgn/t. | 595 bgn/t. |
| Cereals | Price excl VAT |
| Wheat | 642 bgn/t. |
| Sunflower seeds | 1009 bgn/t. |
The week at Agriniser
The week at the platform reflected the general trend of the market – waiting for better and fair grain prices.
We are witnessing a situation in which not the usual factors (the quantity and quality of production, demand and supply, etc.) but political decisions influence the price of grain.
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Exports from our country in September
By 20 September, exports from our home ports reached 211,000 tonnes of grain. Algeria did not stop buying Bulgarian wheat, since the beginning of the month their purchases amount to nearly 120,000 tonnes.
Tunisia is also betting on wheat, with exports from the port of Burgas amounting to almost 40,000 tonnes.
Neighboring Greece and Turkey also made purchases, with the former leaving with 3,000 tonnes of wheat, and the latter with 6,000 tonnes of sunflower oil.
What is the state of grain crops?
According to NIMH data, after the warm weather for the season, a significant drop in temperatures and the usual late summer and early autumn transient changes in agrometeorological conditions are expected in the next seven-day period.
During the period, the expected rainfall will delay the completion of the sunflower harvest and the release of the areas from the earlier corn hybrids. The deepening drought and the subsequent intense rains at the end of the summer in part of the field regions prevented the implementation of deep plowing and pre-sowing treatments of the areas intended for autumn sowing.
For these reasons, delays are expected in the sowing of winter rapeseed, whose agrotechnical terms for sowing expired at the end of the second ten days of September.
How is vegetation progressing?
During the period, a large part of the late agricultural crops will have completed their development. In the case of late corn hybrids, wax and full maturity will be observed, in the case of rice - a ripening phase, in the case of cotton - mass bursting of the pods.
As of 8 September, with half of the sunflower areas harvested in our country, production from the crop reached 1,012,319 tonnes. This is more than double the amount of sunflower harvested at the same time in 2021. The Ministry of Agriculture emphasised that the difference is due to the faster pace of harvesting during the current campaign.
What are the average yields of spring plants?
The average yield for the country from oilseed sunflower is 219 kg/ha, which is a 4.4% drop on an annual basis.
The difference is even greater with corn for grain. According to the statistics, the average crop yields have decreased by nearly 16% this season. So far, 10% of the area has been harvested in the country, with an average yield of 484 kilograms/acre.
Global grain exchange
On the international stage, Saudi Arabia announced that it is buying 535,000 tonnes of wheat with 12.5% protein. Jordan is buying 120,000 tonnes of feed barley and 120,000 tonnes of bread wheat.
Japan has bought nearly 100,000 tonnes of wheat from the USA and Canada. Days earlier, Taiwan bought 65,000 tonnes of corn, possibly from Brazil.
Black Sea region
Although Ukraine's grain exports are increasing, they are still well below last year's level, currently estimated at 5.8 million tonnes since the start of the campaign, compared to 10.9 million tonnes last year to date. For now, corn is the preferred export commodity.
Against this background, a number of European farmers demanded that their governments limit the flow of Ukrainian agricultural products into the EU, citing the consequences of previously introduced measures to support Kyiv.
We recall that last week farmers from Poland, Romania, Bulgaria and France protested against the import of cheaper Ukrainian grain and poultry, which pushes up prices and competes for space in local ports.
France, Romania and Poland under pressure from the EU
"I fully support the aid to Ukraine, but I believe the EU has opened Pandora's box," said Jan Bieniasz, managing director of a farming cooperative in the village of Lonka, southeastern Poland.
In June, he met EU agriculture officials and proposed a plan that would see Brussels own and distribute Ukrainian grain to stop its sale in Europe. "The idea was not met with enthusiasm," he said.
Romanian farmers, on the other hand, complain that in addition to cheaper production, Ukrainian cargoes have displaced local grain from the port of Constanta.
The opinion of their French colleagues is no different.
Poultry group Anvol said earlier this month that next year the EU should not renew the June agreement that raised tariffs and quotas on Ukrainian agricultural products.
It said chicken imports from Ukraine more than doubled in the first six months of 2022 compared to the same period last year, hurting French farmers who have higher production costs.