Analysis Grains
Already optimism about Russian wheat 2025 harvest
Despite larger wheat and corn stocks in the US compared to this time last year, the futures markets closed in the green. In addition to stock figures, the USDA also released the Crop Progress report. The progress with planting winter wheat stood out in particular. In Brazil, soybean planting is not going well. The Russian grain harvest for 2024 is not yet complete, but the first forecast for the 2025 harvest has already been made.
The December contract for wheat on the Matif closed €1.25 higher at €222.25 per ton yesterday. The grains also rose on the CBoT. Wheat closed 0.7% higher at $5.84 per bushel. Corn showed a stronger increase, up 1.6% to $4.24¾ per bushel. Soybeans, on the other hand, lost ground in the last trading session. Soybeans closed 0.8% lower at $10.57 per bushel.
The grain stock in the US is much larger than last season. This is evident from the quarterly figures published by the USDA yesterday. The total wheat stock is estimated at 1.986 million bushels, which is 12% more than in September last year. The USDA's estimated wheat harvest of 1.971 million bushels is lower than market expectations. The corn stock in the US is estimated at 1.760 million bushels, nearly 30% more than this time last year, but well below the average trade estimates. The USDA's stock estimate falls just within the range but at the lower end. Overall, analysts consider the USDA's stock figures bullish for grains.
Corn and soybean harvesting ahead
The corn and soybean harvest is progressing steadily in the US. As of September 29, 21% of the corn has been harvested, the same as this week last season. The five-year average is 18%. More progress has been made in soybean harvesting. 26% has been harvested, compared to 20% last year and 18% in the five-year average. The condition of soybeans remains unchanged from last season, with 64% rated good or excellent. Corn has slightly declined, with 64% of the area rated good or excellent, down from 65% last week.
Winter wheat planting received a boost last week. 39% of the planned area is now planted, up from a quarter the previous week. Last year at this time, 36% had been planted, and the five-year average stands at 38%. 14% of the winter wheat has emerged, slightly ahead of both last year and the five-year average, which stands at 13%.
Drought hampers soybean planting
Soybean planting in Brazil is not progressing well due to drought. According to market agency Safras & Mercado, only 1.9% of the planned area has been planted, compared to 3.9% last year and 2.7% in the five-year average. In Parana, growers are making the most progress with 13% of soybeans planted. In the main soybean-producing province of Brazil, Mato Grosso, only 0.6% of the planned area has been planted. Due to drought and the absence of rainfall in the weather forecasts, farmers are not in a hurry to plant soybeans, according to local sources. Brazilian farmers are further ahead with planting the first corn crop, with 30% of the planned area planted, according to Agrural.
Turkey reduces wheat imports to protect market
Turkey is likely to import much less wheat this season than last season. This is the expectation of the director of a major Turkish mill. During a conference in Baku, Azerbaijan, he mentioned a Turkish import of 5.5 to 6 million tons in the 2024/25 season, as reported by various sources. For comparison, Turkey imported 9.4 million tons last season (2023/24) according to the USDA. The reason for Turkey's reduced wheat imports is the import restrictions the country imposed to protect its domestic market. The import restrictions are expected to remain in effect until October 15, but due to ample stocks in Turkey, sources anticipate that the restrictive measures may remain in place for longer.
At the same millers' conference in Baku, Rusagrotrans made a forecast for the Russian wheat harvest in 2025. The rail company expects Russia to harvest 87 million tons of wheat next season. The 2024 harvest, which is not yet complete, is estimated at 83 million tons by the USDA. Winter wheat planting is currently behind last year but ahead of 2022. Russian wheat exports mainly consist of wheat from the southern part of the country. Wheat from the central region is on the way, but in smaller volumes according to Rusagrotrans. Rusagrotrans does not mention the flooding in parts of Siberia and the drought in southwestern Russia.
