On Thursday Chicago crop prices went down and those of wheat collapsed. In Paris the situation was similar to that in Chicago.

EUR / USD index went up to 1.0976. WTI crude oil dropped to 45.42 USD / barrel.

Yesterday wheat futures in Chicago decreased because of the information that wheat crops have survived after the snowfall in the weekend. The markets seem to be calmed now by the recent data and the Monday’s price rise is erased. The forecast about the average winter wheat yield in Kansas is 46.1 bushels / acre, which is much under that in the last year - 57.0 bushels / acre, but it is above the average forecast of 41.6 bushels / acre. The average winter wheat yield for Colorado is estimated at 31.6 bushels / acre given the last year's record high of 48.0 bushels / acre. For Oklahoma the yield is estimated at 33.7 bushels / acre (39.0). The conclusion is that the damage is not evident so far but the crops look good. There is obviously a potential for very good wheat crop. We have to mention that the moisture is at satisfactory level and the warming weather will allow crops’ recovery. It is also a fact that wheat stocks in the world are enormous and this reassures any attempt to increase prices. The market has not been even affected by the information for US export sales of wheat in the past week which reached 258 400 tonnes, instead of the expected 0-150,000 tonnes.

Wheat tests have not been completed after the snowfall. Under conditions of very humid and warm weather rapid disease development begins.

Yesterday corn futures in Chicago also went down on the grounds of the expectations for dry weather in the coming days and quick advance in crop sowing. Weekly export sales of corn are 771,600 tonnes, which is in line with the market expectations. Sales of soybean are also strong - 318,500 tonnes of the current crop.

In the current season which began in April, India will receive a record high wheat crop according to the FAS USDA forecast. Thanks to this wheat imports in the country will decrease by 2 million tonnes compared to the previous season, down to 4 million tonnes. Indian farmers have expanded the wheat areas to the record 31.75 million hectares compared to 30.41 million hectares in the previous season. Wheat yield is expected to reach 96.5 million tonnes compared to 87 million tonnes in the previous season. However the wheat price in India is currently 250-260 USD / ton. Domestic consumption of wheat will reach 99.8 million tonnes (97.54). Private companies have already purchased 0.5 - 1 million tonnes of wheat with delivery in April - June. Even at the record high new crop, wheat consumption in the country will be 3.3 million tonnes bigger than production.

The harvest of soybean for 2016 - 2017 crop in the Brazilian state Parana (the second largest Brazilian soybean producer) has been completed. The number reaches 3,602 kg / ha, which is 18% more than the previous year and is a record high level in the history. Soybean crop in the state reaches 19.4 million tonnes, which is 2.9 million tonnes more than the previous year. I do not see any way for India to return its role of a net exporter of wheat.

Crop prices dropped significantly in the recent years, and now farmers can hardly earn profit from their production. This will put an end to the expansion of the area with all crops in the new 2017-2018. At the same time we expect the consumption to continue to grow gradually but not fast. Under the new circumstances any deterioration in the weather conditions around the world will make crop prices go up. This will be very noticeable after 2-3 years when grain stocks in the world will be lower than the current and will not be so favorable for the consumers.

In Ukraine and Russia, dry and cool weather goes on. In Western Europe we are expecting rainfall which will stop the drought for this moment.

Wheat Price - yesterday wheat futures in Chicago collapsed after the encouraging information about the wheat crops in Kansas. Kansas production of winter wheat is forecasted at 7.66 million tonnes and an average yield of 46.1 bushels / acre. Weekly export sales of wheat from the US are at the level of 258,400 tonnes from old crop (+ 44.4% compared to the previous year) + 563,400 tonnes from new crop. Export during the week was 622,900 tonnes. The biggest buyers of wheat were the Philippines and Thailand. From the beginning of the season export sales were 38.6% higher than for the previous year.

Soybean Price - yesterday soybean futures in Chicago fell by 2.5 cents / bushel. US export sales of soybean are 318,532 tonnes (-60.6% and -61%) + 12,800 tonnes from new crop. The export was 640,400 tonnes. The biggest buyers are the Netherlands, Indonesia, China and Bangladesh. Sales of soybean meal were 103,600 tonnes + 6,300 tonnes. Soybean oil sales were 10,600 tonnes. Soybean in Argentina was harvested on 49% of the area and 28,214 million tonnes of soybean are stocked.

Corn Prices - Corn futures ended the day with a decrease of 7.75 - 8.25 cents / bushel. Exports of US corn were 771,563 tonnes (-21.9% and slightly above the previous year's average) + 24,100 tonnes. Exports reached 1 226 140 tonnes. The biggest buyers were Japan, Mexico and South Korea. Since the beginning of the season sales have been 51.39% bigger than those in last year and reached 37.21 million tonnes. Last week corn harvesting in Argentina advanced by just 3.2% to 29%, according to information from the Buenos Aires Grain Exchange.