WEEKLY SUMMARY 26 (27.06.2022 – 03.07.2022)

Bulgaria

  • In the last week of June, the development of agricultural crops will proceed at an accelerated pace and temperatures around and above climatic norms, according to NIMH. The precipitation during the second ten days of the month has increased the soil moisture reserves and improved the conditions for the vegetation processes in the spring crops.
  • During the next seven-day period, sunflower inflorescences will be observed in the Danube plain and in the central regions of Southern Bulgaria. In the case of maize, depending on the sowing dates and the early maturity of the hybrids, leaf formation and sweeping will take place. In the Polish regions of the country the barley is in the phase of full maturity. In wheat, waxy and full maturity will be observed.
  • During most days of the period in the regions of Western Bulgaria the conditions will allow the implementation of seasonal agro-technical measures, the most important of which is the harvest of mature crops with barley.

Europe

  • The cereals market is worried about the bleak prospects for global economic growth, but the optimistic element of the market is the forecasts of summer harvests. The price of wheat on the Euronext exchange fell to the level of 2 months ago, mainly because Russia has increased its production, now estimated at about 89.2 million tons, a record for the federation. On the other hand, the situation in Ukraine has not worsened, despite the lack of progress in negotiations on possible maritime corridors to deliver Ukrainian grain to those who need it.
  • The Prime Minister of Great Britain stated that the kingdom is willing to witness the demining operations off the south coast of Ukraine and any effort to clean up the mines would be the biggest attempt since the Iran-Iraq war of the 1980s and would take several months. A secretary in the UK foreign ministry said measures must be taken to maintain global supply and the UK has therefore promised £ 372 million in aid to the countries most affected by the lack of Ukrainian grain exports and the lack of grain. fertilizers.
  • Matif oilseed rape prices are falling, following the recovery of Indonesian palm oil exports and falling oil prices, with markets worrying about a possible recession following rising interest rates and tightening monetary policies. Canada and Australia are expecting good canola production this year.

America

  • Grain market volatility has now shifted CBOT prices in the other direction. Good weather with rain forecasts in most of the United States caused corn and soybean futures contracts to fall by 3% and harvest progress in the northern hemisphere continues to drop wheat prices, which lost between 2 and 3.75%. Energy futures contracts were also in the red, with oil prices at $ 104 / barrel, with reductions in diesel and gasoline prices.
  • Moreover, low demand from China and an extraordinary maize harvest in Brazil affect futures contracts for maize and soybeans. Soybean stocks in China rose last week and recent data showed that the country imports a smaller volume of soybeans from the US and Brazil (which is now the cheapest source). Due to this low demand from China, Brazil exported 3.1 million tons of soybeans in the first two weeks of June, which is 72% below the same period in 2021, while analysts expected the country to deliver externally 10.8 million tons in June.
  • The IGC increases the estimate of global cereal production for the 2022/23 season to 2255 million tonnes, mainly due to increasing revisions of maize production for Ukraine, where the area under cultivation exceeded initial expectations. World corn production is estimated at 1190 million tonnes, soybean production at 390 million tonnes (with marginal improvements in crops in India and South America) but wheat production remains unchanged from the May forecast of 769 million tonnes.

Black Sea region

  • So far in June, Ukraine has exported more than 1 million tons of cereals and oilseeds, bringing the total external deliveries since the beginning of the 2021/22 season to 48.13 million tons, of which 18.687 million tons of wheat, 5.739 million tons of barley, 23.232 million tons of corn and 69.1 kilotons of wheat flour.
  • Slovakia is working to create a rail transport corridor for grain from Ukraine to the port of Bratislava, from where it can be transported on the Danube to the port of Constanta and from here it can go to Africa or the Middle East. A Slovak official said that this corridor would be “much shorter, cheaper and more environmentally friendly than other alternatives”, adding that “the port of Constanța is also part of the new Silk Road in Asia, which is changing due to the war in Ukraine”.
  • According to US officials who showed satellite images, the Russian navy was ordered to put me around the ports of Odessa and Ochakiv and has already done so for the Dnieper River, as part of the blockade of Ukrainian grain exports. Russia has denied putting me around the Black Sea port, claiming instead that the Ukrainians have mined their own ports. The impact of Russia’s actions, which have halted maritime trade in the northern third of the Black Sea and made the region unsafe for navigation, cannot be underestimated, as Ukraine’s maritime grain exports are vital to global food security.
  • Officials from G7 countries (Canada, France, Germany, Italy, Japan, the United Kingdom and the United States) meet this weekend to discuss temporary exemptions for biofuel incorporation mandates, in an attempt to combat rising grain and vegetable oil prices food on the market. Crop prices for biofuels have risen this year, wheat and maize have risen by 25%, while soybean oil has risen by about 20%. Up to 40% of the US corn crop is currently used to blend ethanol with gasoline, accounting for about 5% of the country’s transport fuel, while 10% of European grain production is used for biofuel.