Grains prices in Chicago underwent various changes on Wednesday. Rapeseed went down in Paris while wheat and corn remained steady.

The EUR/USD index went up to 1.0715. Crude oil went down to 50.43 USD/barrel.

Schist gas production in China increased by a little over 50% in March. 1.15 billion m³ Schist gas were produced in the country last month. Production increased by 17.4% to 2.67 billion m³ in the first quarter.

Over the past few weeks, rainfall in Western Europe is quite insufficient at 30% of the standard. Great Britain, France and Spain are the most severely affected countries. Forecasts include mainly deficit in the next 10 days. There is similar concern for the Northern African countries, too – Morocco and the Western parts of Algeria. Although the two countries mentioned above expect a huge yield growth, there is a lack of humidity there as well. This news led to price increase in Chicago yesterday, but the growth seized before the end of the session following the news of increased forecast of wheat yield in Argentina. Buenos Aires Grain Stock Exchange estimates the new season wheat areas in Argentina at 5.5 mln hectares with a yield of 17.5 mln tons versus last season’s 16.3 mln tons.

Corn markets are still evaluating the effect of the heavy rainfall in the USA as well as the delayed corn sowing. Rainfall in the Mid-West will continue in the next few days, which will further delay the sowing. Sowing will be faster in the beginning of the next week due to the lack of rain. Temperatures will drop for a number of days, but then they will go back to normal to stimulate crop growing.

There has been some raining and snowing in Central Russia and Ukraine, which has halted autumn crop development as well as spring crop sowing. There has been no information of damage so far, but it is not unlikely.

There will be no rain in Argentina in the next 10 days, which will facilitate harvesting mostly soybean and partially corn. Currently, soybean and soybean by-products supply in Argentina is below the estimated level due to the harvesting delay. The market, however, detected an alternative to soybean oil purchase – substitution for palm oil, whose production is on the rise in Indonesia and Malaysia.

Over the past week, ethanol production in the USA grew by 7,000 barrels daily up to 993,000 barrels daily. Ethanol stocks grew by 131,000 barrels to 23.034 mln barrels.

There is a change in the grain import regulations in China. VAT has been cut by 2% down to 11%, which is expected to boost soybean export.

According to a CREA estimate, the 2017 wheat import in Brazil will be 6.6 mln tons, which will be the highest level for the past 21 years. 1.67 mln tons of wheat were imported in the country in the first quarter of the year including 588,120 tons in March. Argentina’s share of the total delivery was 85%. Between August 2016 and March 2017, wheat import in Brazil reached 5.16 mln tons.

Farmers in Canada are ready to sow more rapeseed and cut spring wheat areas.

Millions of tons of safrinha may remain outdoors in Brazil if farmers fail to vacant their storage areas, currently full of soybeans. There has always been a lack of storage area in the country, but this year’s high production will make the problem worse. The record high soybean yield and the oncoming corn one will put everyone into a difficult situation. Moreover, farmers are currently holding the soybeans longer than usual in the hope of higher prices. As of the end of March, farmers had sold mere 49% of their soybeans yield as this has become the slowest selling tempo in the last 7 years. Soybeans and corn prices in Brazil are currently below the production costs. Corn harvesting in the state of Mato Grosso is about to start in June, which is quite soon. We will witness images of huge piles of corn at the farmers’ sites then.

UkrAgroConsult has increased their forecast on 2017 – 2018 corn export from Ukraine by 1 mln tons to 20 mln tons with current season estimates of 19 mln tons. The growth is due to the +700,000-ton increase in yield forecast up to 26.2 mln tons in 2017. The yield will most likely be between 26 and 26.5 mln tons, but definitely higher than the 2016 level.

Corn price – Corn remained steady in Chicago yesterday. American corn export sales for the past week will be 700,000 – 1,400,000 tons. China is expected to increase its corn processing capacity in the next 3 to 5 years by 40% to 70 mln tons. Thus, the authorities intend to reduce corn stocks, which are now 250 mln tons.

Soybean price – Soybeans futures in Chicago went down by 4.25 cents/bushel yesterday. American soybeans export sales will be 250,000 – 1,000,000 tons – quite a high estimate margin. Soybean meal sales will be 50,000 – 350,000 tons while 8,000 – 42,000 tons of soybean oil will be sold. 8.62 mln hectares of rapeseed will be sowed in Canada, which will be 4.58% more than last year.

Wheat price – Wheat futures in Chicago went down by 2 – 5 cents/bushel yesterday. American wheat export sales will be 300,000 – 950,000 tons. Spring wheat areas in Canada are expected to be cut down to 8.66 – 9.31 mln hectares or an average of 9.07 mln hectares, which will be 3.5% lower than last year. Rainfall is causing a delay in spring wheat sowing. The Ministry of Agriculture of Ukraine estimates the current season’s wheat export from the country will be 15.24 mln tons or +10.77% more than last year.

After all the news of rainfall and sowing in the Northern hemisphere we conclude that there will be a delay in all campaigns that is all grains’ sowing will be late.