On Tuesday wheat and corn prices remained stable and soybeans rose. In Paris crop prices also declined significantly.

EUR / USD index went up to 1.1095. WTI crude oil dropped slightly to $ 48.72 / barrel.

The oil market has practically reached a balance and this process will continue to accelerate in short term, the International Energy Agency (IEA) predicts in its monthly report. Global oil markets are to reach a supply-demand balance in 2017, the agency predicts, supply shortages are expected to expand more rapidly in the near future. Experts say growth in global demand will slow  down for a second consecutive year. However they warn that even if OPEC's contraction of the mining yield is prolonged, "there is still a lot to be done in the second half of 2017 to shrink the stocks  close to the 5-year average."

Impact on Chicago market yesterday had the forecasts for new rainfall and rapid progress in corn sowing and spring wheat sowing. The weather is a factor with mixed impact now. Rainfall helps the development of the new plants, but there are too many in some places. There are fears that wheat in the central parts of the United States, will be of poor quality as a result of many diseases. These factors ensured price stability for wheat and corn yesterday in Chicago.

We can now talk about average sowing of corn in the US. The transfer to soybeans may not be too great, and corn will retain areas of about 90 million acres, and soybeans around 88.5-89 million acres. Everything is already in the hands of nature and rainfall. In the recent years the  natural conditions have been mostly favorable or very favorable. Now I suppose there are some problems, not big, but some. With a decrease in average US corn yield to 167 bushels / acre and areas to 90 million acre , corn crops will be 351 million tonnes. It is not small, but demand also increases. With these results the market will be neutral. It will be very important what corn crops will the farmers in Brazil and Argentina  have in early 2017.

On Tuesday the USDA announced an export sale from the US of 132,000 tonnes of soybeans from current crops to an unknown buyer. This supported soybeans and prices rose. The big sale comes at a time when Brazil has captured the world market, which is indicative for strong demand.

  For soybean things are similar as to corn, but they are a bit different. The base is strongly down. In Brazil the soybean crop is record high. In the US in 2016 also the crops was record high. Now record levels of  soybeans are sown in the United States. There is no hint of a drop in anything in the sector. Everything is based on the high demand for the moment, and we all believe it will be so at least for another 1-2 years. If the demand is not strong - RIGHT. If it is strong - a neutral position, but not a growth. Prospects for price rise - YES, BUT AT a MINIMAL RAINFALL IN JUNE - JULY IN THE USA. Another problem is the decreasing consumption of soybeans in the US in the recent months. Processing is continuously decreasing. The strength of soybeans in the US comes from a steadily high export that does not drop to a minimum level even during those months. A factor supporting US exports is the power of the Brazilian real, which hampers exports. The specificity now is that soybean stocks in US farmers are high and difficult to reduce. Farmers do not sell much soybeans even from the new crop, because the insurance is at a price of 10.2 USD / bushel, and now the price is much below this level. Some analysts estimate that even with soybeans yield in the US of 48 bushels / acre, the final crop stocks in the new season will exceed 13.6 million tonnes.

The authorities in Brazil take measures to protect local ethanol producers from importing the product from the US. Measures will not be expressed in import duties but in rules that will make imports difficult.

In the past week farmers in Argentina have harvested 18% of the soybean areas, thus reaching a total crop of 2/3 of the area. The result is 15% higher than last year. High yields will be the reason for the increase in the crops estimate, which is now 57.5 million tonnes.

Authorities in the Chinese province of Haiyuziang and Liaoning will pay bigger subsidies to soybean farmers but will reduce the subsidies for corn-growing farmers. The goal is to reduce the production of corn and thus the stocks.

Wheat prices - yesterday wheat futures in Chicago remained stable. Egyptian state-owned company announced a wheat purchase auction and the results will be announced today. This is the first auction for the past weeks, even months. The delivery of the wheat must take place in the middle of June, ie. this is wheat from the current crop. Egyptians raise wheat protein requirements by 0.5%.

Soybean prices - yesterday Soy Futures in Chicago rose by 6.5 - 11 cents / bushel. Faster sowing of corn in the United States reduced the fears that much of the area planned for corn will be trasferred to soybeans. Analysts estimate that 7.18 million tonnes of soybeans were processed in China in April, 5.6% more than in March. Abiove predicts that the soybean crop 2016 - 2017 in Brazil will reach 112.5 million tonnes. The forecast for exports is also raised to 61.7 million tonnes .Exports of Brazilian soybeans are expected to grow, but at the expense of whom ????

Corn prices - yesterday corn futures in Chicago remained stable. The corn sowing campaign in Iowa and Illinois has advanced very quickly in the past week. In the current week, good results are also expected. Soil temperatures are not high enough for the good development of the young plants, but this is the situation this spring. Mexico has purchased 60,000 tonnes of corn with delivery in August.