24 November 2023

IMilling wheat is crushed by the financial markets. Grains are swept away in a downward spiral that is driving grain valuations. On the European stock market Euronext, the price of a tonne of wheat fell on Monday March 20, the day of the beginning of spring, below the 250 euro mark. To be compared with the historic high of 438 euros per tonne, reached in mid-May 2022, in the midst of a speculative commodity bubble. Large grain warning on wheat…

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The fall in the price of ears of corn is not new. In November 2022, it was priced at 325 euros. In January 2023, it fluctuated between 280 and 285 euros, returning to its level before the Russian-Ukrainian war. Then the slide continued. This tumble is to be credited to financial operators who are selling their positions. They press the button on the risk of slowing growth linked to negative signs given by banks »considers Arthur Portier, of the firm Agritel.

Short of wheat in their coffers, Credit Suisse and Silicon Valley Bank are dragging down the grain markets… Especially since, if investors are counting on a lesser appetite in the economy, the granaries are still well filled. After its record harvest in 2022, there should be 20 million tonnes of wheat in stock in Russia at the end of the season., emphasizes Mr. Portier. At the global level, over the year 2022-2023, the collection of golden grain reached 763 million tonnes, a volume never reached before, thanks to the bountiful harvests in Russia, but also in Australia. For the greatest relief of the people.

Rapeseed and sunflower are not spared either

All that wheat ended up circulating. The grain agreement signed on July 22, 2022 between Ukraine and Russia, under the aegis of Turkey and the United Nations, to ensure grain exports from Ukrainian ports, has been regularly renewed. It was extended again, on March 18, even if Russia cast doubt on its duration, evoking sixty days against one hundred and twenty until then. Thanks to this secure corridor, the flow of Ukrainian agricultural products on board has risen to five million tonnes per month.

The cold wind that lowers the price of wheat affects corn just as much. As for rapeseed and sunflower, they are not spared either. The price of rapeseed went from 640 euros per tonne in October to 430 today. And over the same period, that of the sunflower from 1,000 to 400 euros per ton”, says Mr. Portier. The barrel of crude drags oils and biofuels down with it.

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