Grains prices in Chicago went up on Tuesday with soybean in the lead. The satiation in Paris was identical but rapeseed was the leader here.

The EUR/USD currency pair increased to 1.0597. Light oil decreased to 54.00 USD/barrel.

Britain is about to remain the only European country to allow schist gas extraction, thus taking advantage of potentially large amounts of their own energy sources. Schist gas extraction was banned in countries like France, Germany and Bulgaria following pressure from environmentalists.

Rumours that American state administration will allow biofuel mandate increase sent all grains prices up yesterday. Mixing ethanol into petrol is likely to rise from 10% to 15% in the summer months.

Egypt bought huge lots of wheat yesterday – 535,000 tons from Russia, Romania, France and Ukraine to be delivered between April 1 and April 10. This will be the first time French wheat is delivered this season.

The cheapest price at the auction was on French wheat – 197.00 USD/ton FOB. The lowest C&F price was offered on Romanian wheat – 208.38 USD/ton. Russian, Ukrainian, Romanian, American and French wheat was offered at the auction. Egypt bought 535,000 tons of wheat at the auction including 235,000 tons of Russian wheat, 120,000 tons of Romanian wheat, 120,000 tons of French wheat and 60,000 tons of Ukrainian wheat. The auction prices were higher than last week auction. Very high GASC wheat import is expected. This information is not the result of the reforms in Egypt which prevented private companies from selling imported wheat at higher prices pretending they are selling domestic wheat. With the current restriction, GASC needs to import more.

These were the best C&F offers:

- Romanian wheat at 197.89 USD/ton FOB + freight 10.49 USD/ ton, a total of 208.38 USD/ ton C&F.

- Russian wheat at 197.94 USD/ ton FOB + freight 10.85 USD/ ton, a total of 208.79 USD/ ton C&F.

- Russian wheat at 198.85 USD/ ton FOB + freight 11.24 USD/ ton, a total of 210.09 USD/ ton C&F.

- Russian wheat at 199.70 USD/ ton FOB + freight 11.24 USD/ ton, a total of 210.94 USD/ ton C&F.

- Romanian wheat at 200.50 USD/ ton FOB + freight 10.49 USD/ ton, a total of 210.99 USD/ ton C&F.

- French wheat at 197.00 USD/ ton FOB + freight 14.12 USD/ ton, a total of 211.12 USD/ ton C&F.

- Ukranian wheat at 200.75 USD/ ton FOB + freight 11.97 USD/ ton, a total of 212.72 USD/ ton C&F.

- American wheat at 197.50 USD/ ton FOB + freight 22.29 USD/ ton, a total of 219.79 USD/ ton C&F.

Black Sea region wheat was the leader once more, at an auction carried out by Iraq. Romanian wheat was the cheapest at the Iraqi auction. There was an offer for delivery at the price of 244 USD/ton C&F. Bulgarian wheat came second at 244.50 USD/ton C&F followed by Ukrainian wheat at 245.0 USD/ton C&F and Russian wheat at 245.5 USD/ton. The lowest price of Canadian wheat was 322 USD/ton while Australian wheat was sold at 320 USD/ton.

In February, wheat crops condition in the American state of Montana deteriorated considerably. There was some improvement in the states of Oklahoma and Kansas. 51% of the crops in Montana are in good or excellent condition versus 70% a year earlier. 43% of the crops in Oklahoma are in good or excellent condition (33% a month earlier and 68% a year earlier). 40% of the crops in Colorado are in similar condition (36 and 45%). 44% of the crops in Kansas are in good or excellent condition (43% and 59%). Despite the changes, crop condition remains considerably worse than last year.

Crop condition is not good which matches the reduced wheat areas in the USA. The forecast for a wheat yield of 50 mln tons is realistic which will boost prices in the new season. Meanwhile, Russian administration states that the decline of the grain yield in the new season in Russia will not be too big compared with 2016. The cold and long winter did not allow crops to grow as fast as in previous years. Oil remains strong which leads to a strong ruble. The big wheat ending stocks in Russia could be a problem this season.

Argentinian Ministry of Agriculture revised and increased the country’s crop areas this season +50,000 ha up to 7.3 mln ha. Areas are growing in key districts such as Cordoba and Buenos Aires. Soybean areas forecast has been reduced and it will be the lowest figure for the past five years – 19.45 mln ha (-0.35).

The sowing of first harvest corn in Brazil is running slower than last year. 57.3% of the planned areas have been sowed so far, which is 16.2% below last year’s level. Conab projects this season’s corn yield in Brazil at 87.4 mln tons, including first harvest 28.8 mln tons and  safrinha 58.5 mln tons.

There are no reports of serious problems in South America.

Contracts have been replaced by the following.

Corn price – Corn futures in Chicago went up by 5.25 – 6.25 cents/bushel yesterday. The rise was due to rumours of the introduction of E15 petrol on the market in the USA. However, these are only rumours and not a governmental decision. The White House has denied them so far. Israel is planning to purchase 85,000 tons of corn. Corn yield in South Africa is projected at 13.92 mln tons versus 7.78 mln tons in the previous year, when drought reduced production.

Wheat price – Wheat futures in Chicago went up by 6 cents/bushel yesterday.

Soybean price – Soybean futures in Chicago went up by 20 cents/bushel yesterday. The forecast in the USA for January is for the processing of 4.6 mln tons. Soybean was boosted yesterday by rumours of changes in biofuel regulations.