Weekly Analysis 11.01.2021 - 17.01.2021

Over the past week, CBOT wheat and soybean futures have increased significantly! In Paris, nearby wheat and corn futures have risen noticeably and new crop prices have also slightly increased. During this week, however, rapeseed price in Paris dropped!

Over the past week, the currency pair EUR/USD fell by 0.0136 to 1.2082. US WTI crude oil price rose by 0.12 USD/barrel to 52.36 USD/barrel.

Oil prices rose slightly last week after new restrictive measures in China over coronavirus outbreaks. “With the Biden package offset by weak U.S. employment data, markets in Asia are disinclined to force prices, said Jeffrey Halley, a senior market analyst at OANDA. Crude oil imports to China increased by 7.3% in 2020, with the number of refineries increasing and low prices causing stocks to increase.

           CBOT Chicago 15.01.2021
                  Wheat SRW
month  03.21  07.21  09.21   12.21
USD/mt  248.20  241.68  241.59  243.34
month  03.21  07.21  09.21   12.21
USD/mt  209.24  204.44  191.13  181.09
month  03.21  07.21  11.21   01.22
USD/mt  520.57  514.78  461.78  437.89
           Euronext Paris 15.01.2021  
month  03.21   05.21   09.21   12.21
EUR/mt  231.50  227.75  201.25  201.00
month  03.21   06.21   11.21   01.22
EUR/mt  212.00  210.50  187.00  187.50
month  02.21   05.21   08.21   11.21
EUR/mt  432.25  426.00  397.25  396.00


On Friday, March CBOT SRW wheat futures rose by 5 1/2 cents to close at $6.75 1/2 a bushel. Authorities in Russia have started discussions with stakeholders on extending export duties on all crops in 2021/22. This is due to the quick decision to increase the export tax on wheat from 25 EUR /ton to 50 EUR / ton for the period 1.03 - 30.06.2021.

Markets in the United States will close on Monday which had an impact on trading on Friday - wheat did not go up significantly and corn and soybean prices fell.

Chicago Mar 21 corn futures fell by 2 3/4 cents to $5.31 1/2 a bushel on Friday.

Chicago March soybean futures fell by closed at $14.16 3/4 a bushel on Friday, down 13 3/4 cents. The profitability of soybean processors in the United States continues to decline - a drop of  36% to 63.6 cents/bushel since the beginning of the year. In December, soybean crush reached 4.98 million tons in the United States, which is below the expectations of 5.03 million tons, but still more than in November and a new monthly record. The USDA announced a private export sale of 318,000 tons of soybeans from the new 2021/22 crop. It is already difficult to find quantities from the current crop due to the little stock level.


Chicago fund positions (futures + options), for the week ended January 12.

Accumulated US Export Sales, for the week ended January 07.

            Managed Money
 CBOT   Long    Short     Net
thd. contracts Position  +/- Position  +/- Position  +/-
SRW wheat  89.9 -3.9  72.8 4.3  17.0 -8.2
Corn  430.9 21.7  56.2 -3.1  374.7 17.8
Soybeans  183.9 -6.2  17.5 3.1 166.5 -9.3
Soymeal  90.8 -1.3  6.4 -1.1  84.4 -0.2
Soyoil  106.9 -14.2  13.3 5.1  93.5 -19.3
       Total Export Commitments
   US  20/21  19/20  18/19
   million tons   Jan 07   Jan 09   Jan 10
Wheat  21.060  19.585  17.909
Corn  45.382  19.301  32.287
Soybeans  55.676 30.413  30.369
Soymeal  6.288  5.988  6.910
Soyoil  0.502  0.464  0.406


*Source: CFTC, USDA

Over the past week, the long corn position has continued to grow rapidly. Net long positions in wheat and soybeans decreased moderately. Net long position of soyoil has dropped very sharply which could potentially indicate that oils are going down.

Throughout the past week, there was rainfall in Western Europe, parts of Australia and Argentina and Brazil. Temperatures have been low in Ukraine and especially in Russia, but there is enough snow cover to protect the crops. Over the next 10 days, very low temperatures and minimal rainfall are expected in the US Corn Belt. In the US Wheat Belt, temperatures will stay around 0 degrees, without precipitation. In Western Europe (France)- positive temperatures and good rainfall. In Germany and Poland, temperatures are predicted at around 0 degrees with minimal rainfall. At the end of the previous week, temperatures dropped to -20 degrees in Poland. On the Balkans, temperatures have been low at the start of the week and got warmer over the week. In Ukraine, temperatures will rise from -25 degrees to around 0, but without precipitation. In Indonesia and Malaysia, light to moderate rainfall is expected. In Australia- warm to hot weather without precipitation. It's still raining all over Brazil! In Argentina, warm to hot weather without precipitation. For now, issues around weather conditions remain only in Argentina. The prolonged drought will have a destabilizing effect on the world's grain market. Every week, weather conditions in Brazil are improving. Drought also has a negative effect on wheat crops in the United States.


  US   Week    Аccumulated
thd. tons ended 07.01  20/21  19/20
Wheat 358.5 14,741 14,960
Corn* 1,464.3 16,721 9,434
Soybeans 2,040.0 41,115 23,173
   ЕU  Week    Accumulated
thd. tons ended 10.01   20/21   19/20
Wheat 181.691 14,097 16,940
Corn* 8.198 1,089 2,412
Barley 762 3,803 4,156


 Russia  Week   Аccumulated
 thd. tons ended 12.01  20/21  19/20
Grains 800.0 33,000 27,500
Wheat 700.0 27,600 22,398
Corn* 0.0 1,200 1,736
Barley 100.0 4,000 2,526
Ukraine  Week   Аccumulated
 thd. tons ended 15.01  20/21  19/20
Grains 796.0 27,203 33,201
Wheat 156.0 12,662 15,297
Corn* 522.0 10,253 13,725
Barley 110.0 3,886 3,814

* US (September - August)

* Russia, Ukraine and EU (July - June)

US Weekly wheat exports are not strong and at the same time weekly export sales were very low. Exports and weekly export sales of corn and soybeans from the United States were high and this supported prices. EU wheat exports remain weaker than the previous season.

The export of wheat from Russia for the past week cannot be determined, because the data was from 14 days ago. The indicator is most likely declining, but we will have to wait for data from the current week. Data on exports from Ukraine were also not for 7 days, but for 9 days. It should be noted that during these periods both countries were on long holidays, which also affects the indicators.

Last week, tons of news came out, more data than we could have asked for - the January report of the USDA, the January report of the IGC, decisions on new restrictions on the export of wheat, corn and barley from Russia!

During the week, the USDA published its January report on the state of the world's grain balance in 2020/21.




 million tons

20/21 Jan

 +/- 19/20

 +/- Dec

















palm oil





 million tons

20/21 Jan

 +/- 19/20

 +/- Dec

















palm oil





- World's wheat stocks have been decreased by 3.3 million tons compared to the December estimate, mainly due to a decline in China and the United States.

-The world's corn production estimate was reduced by 9.7 million tons due to a decline in the United States (reduced average yield for 2020), Brazil and Argentina.

-The ending corn stocks fell by 5.1 million tons due to a reduction in the United States.

-The world's soybean production estimate has been lowered by 1 million tons due to drop in the estimate for Argentina.

-The ending world's soybean stocks have been decreased by 1.3 million tons and those in the United States reached a historic low of 3.8 million tons. On the contrary, China's soybean stocks increased by 1.8 million tons.

In summary, the report was seen as a indicator for strong bull market for all crops.

During the week, the IGC published its January report on the state of the world grain market.

Key points can be seen below:

IGC January 2021

                TOTAL GRAINS

 million tons 20/21  Jan  +/- Nov  +/-  19/20 avg. level for the last 4 years +/- avg. level



















Ending stocks  611  -5  -6  626  -15


 million tons 20/21  Jan  +/- ное  +/-  19/20 avg. level for the last 4 years +/- avg. level


















Ending stocks








 million tons 20/21  Jan  +/- Nov  +/-  19/20 avg. level for the last 4 years +/- avg. level


















Ending stocks







 million tons 20/21  Jan  +/- Nov  +/-  19/20 avg. level for the last 4 years +/- avg. level


















Ending stocks







The decline in the ending stocks of grain, wheat, corn and soybeans in the largest exporters is deepening. Corn and soybean ending stocks levels are well below those of recent years. Prices will now be extremely sensitive to expectations for new productions.

Should I sell wheat or keep it? USDA and IGC reports on wheat were not bullish but news from Russia put wheat in the spotlight.

Export taxes from Russia:

  • wheat- period of 15.02 - 01.03.2021 - 25 EUR/ton; 01.03 - 30.06.2021 - 50 EUR/ton
  • corn- period of 15.03 - 30.06.2021 - 25 EUR/ton
  • barley- period of 15.03 - 30.06.2021 - 10 EUR/ton 

Quota for export of wheat, corn, barley and rye period 15.02 - 30.06.2021 - 17.5 million tons. After 01.07.2021 - floating duty for the new crop

Authorities in Russia are discussing a reduction in current domestic grain prices. In December, when a decision was made on a duty of 25 EUR/ton, it was considered that this would be enough to reach their targets. However, this did not happen because world's prices reacted positively and went up. At the same time, Russian farmers have cut their sales a lot and started making plans to sell old crop in the new season in order to avoid selling the new crop at low prices. The government's goal is , however, to force farmers to sell their production cheap. From all this, it turns out that at the moment Russia is currently not a factor on the world grain market or more precisely, it is gradually stepping away. Domestic prices are not low enough to collect taxes and then sell them competitively. Buyers of Russian wheat are switching to Ukraine, whose FOB wheat prices have continued to rise over the past week.

For January, wheat exports from Russia are expected to remain at a good level. In January, the export of wheat from Russia is projected at a record for the month of 2.7 - 2.8 million tons and a total grain exports of 3.3 million tons, according to Rusagrotrans. According to a preliminary estimate, grain exports in December amounted to 4.73 million tons, including wheat exports of 4 million tons. The domestic wheat market in Russia is less active given the uncertainty before the introduction of export taxes.

During the week, Egypt held a tender to buy wheat. The tender was canceled, but the offers made are very representative of the market situation.

  • Two offers for sale of French wheat at a price of FOB 293.86 - 297.75 USD/ton + freight 19.45 USD / ton, a total of 313.31 - 317.20 USD/ton C&F
  • One offer for the sale of Romanian wheat at a price of FOB 292.97 USD/ton + freight 13.65 USD / ton, a total of 306.62 USD/ton C&F
  • One offer for the sale of Russian wheat at a price of FOB 315.00 USD/ton + freight 14.27 USD / ton, a total of 329.27 USD/ton C&F

The tender was canceled due to the expectation of the Egyptians for a drop in prices in the coming days. This, although, did not happen, and there are no conditions for it to happen from now on. Only four offers were made at the tender and this indicates weak competition. Russian prices were far above the others - apparently in response to high domestic prices.

FOB prices of wheat around the world have been:

  • US : SRW wheat- 299 USD / ton (+14 USD/ton for the week), HRW- 305 USD/ton (+21)
  • France - 286 USD/ton (+11)
  • Argentina - 302 USD/ton (+21)
  • Australia - 295 USD/ton (+18)
  • Ukraine - 287 USD/ton (+15)

European prices are the lowest on the market, there will be enough demand to maintain at least the current price levels. On Monday, the stock exchanges in the United States are not working and we will not have an exact benchmark, but also new incentives for growth. Most likely, Egypt will hold another tender, this time for the purchase of 60,000 - 120,000 tons of wheat from France and Ukraine. If the corn market calms down given the good rainfall in Brazil, wheat is unlikely to make much progress. At the same time, it is not raining in Argentina and it is dry in the US Wheat Belt. Russia is still expected to sell at least 12-13 million tons of wheat this season. However, we will still see more reductions in the forecasts for the export of Russian wheat for the season by at least another 2.5 - 3 million tons.

Bangladesh has said it will seek larger purchases of Ukrainian wheat. However, Ukraine has to export less than 4 million tons of wheat by the end of the season.

The European Commission expects the new EU wheat production (2021) to reach 129.7 million tons compared to only 119.3 million tons in 2020 - this is the forecast for the EU 27 (excluding the UK).

What are we going to do with the corn? For now, it is quietly raising its price in the shade of wheat, but its time will come for it to be №1 on the market - not with huge growths, but with increased both supply and demand. The USDA and IGC reports proved to be bullish for corn given the shrinking US crop stocks. The USDA lowered its estimate for the average corn yield in the United States for 2020 from 175.8 bushels/acre to 172 bushels/acre. Exports are projected to decline by 3.8 million tons, possibly reflecting expectations that Brazil will have a strong second production and lower prices. Exports are expected to drop by 2.5 million tons. Rainfall in Brazil acts in the opposite direction, but this is the country's first corn crop, which is about 25% of the total and is not usually exported. In recent years, I have not noticed such a long series of rainfall without interruption - now approaching nearly two months of continuous moderate rainfall. In Argentina, corn crops need rainfall because yields are now being formed. Ukraine exports corn, but the quantities are a little over 400,000 tons per week, which is relatively little. Despite rising prices, everyone is looking for the United States for large and regular deliveries. China is expected to be heavily involved in purchases again given high domestic prices. The Chinese Bureau of Statistics announced that this year's corn deficit in the country will be 28.5 million tons, which means more purchases from international markets. If weekly corn exports from the United States continue to be at such high levels, it will soon be time for the USDA to change its forecast for exports and ending stocks again.

Let's break down the FOB corn prices:

  • US - 255 USD/ton (+14)
  • Brazil - 279 USD/ton (+14)
  • Argentina - 267 USD/ton (+13)
  • France - 265 USD/ton (+6)
  • Ukraine - 266 USD/ton (+20). This is 10 USD/ton higher than the record set in May 2014.

US corn has currently the lowest price. Black Sea corn is well positioned in terms of price, given that it is non-GM and close to large consumers in the EU, North Africa and the Middle East. As for corn, there is not much that could happen in the next 2-3 months to drastically increase the supply in the world. Argentina lifted the ban on corn exports last week and this would potentially have a negative impact on corn prices.

Oil segment - USDA lowered its estimations of soybean yield in the United States for 2020 from 50.7 bushels/acre to 50.2 bushels/acre. The record level of US soybean crush of 5 million tons in December supported oil prices. Good export sales last week again call into question whether the USDA has forecast enough exports and low enough ending stocks, which are already very, very limited - 3.8 million tons. Any major export sale leads to doubt as to where this quantity will come from. It is also questionable whether high prices really limit demand or whether they are just a number and no longer mean much - after all, inflation has come to this sector as well.

At the end of the week, there was a drop in world oil prices. Apparently, the market is tired of high prices and is now in a period of slight decline, which may remain permanent. US Soybean stocks will be very limited, but everything overheats at some point.

China bought 758,000 tons of soybeans from the United States last week alone. So far, China's purchase commitments reach 33.5 million tons and additional 4.5 million tons of purchases as an unknown buyer. In 2020/21, China is predicted to import 38 million tons of soybeans from the United States and 44 million tons in 2021/22. But will the United States manage to meet China's demand? In order to meet it, US soybean production must be exceptional.

The soybean market has changed a lot for the past several months. Any little drop in productions affects the price instantly and causes it to increase significantly. Something similar happens with corn. With decreasing stocks in the United States, we are already anxiously monitoring the rainfall in South America and La Niña, which will bring drought in the Midwestern United States during the summer.

Changes in FOB Prices of key exporters:

        Changes in FOB prices in USD/t




   period 15.01 08.01 +/- 15.01 08.01 +/-
wheat  305  284 +21  302  281 +21
corn  255  241 +14  267  254 +13
soybeans  562  542 +20  578  552 +26

        Changes in FOB prices in USD/t




   period 15.01 08.01 +/- 15.01 08.01 +/-
wheat  287  272 +15  286  275 +11
corn  266  246 +20  265  259 +6
sunseed  732  718 +14  640  620 +20


We have never seen such strong double-digit rise in FOB prices around the world! This is unlikely to happen again so keep this in mind.

Wheat - Wheat prices have risen sharply. Russia has heated up the world's wheat market.

Corn - Over the past week, corn prices increased significantly. It is a bit unusual for French corn to be the cheapest on the market but that will soon change as French corn prices are also expected to skyrocket. Corn price in Brazil rose by 14 USD/ton to  a total of 279 USD/ton. Black Sea corn price is currently 1 USD/ton higher than US corn but this is nothing new given the qualities and the difference in freight.

Soybeans - During the week, soybean prices continued to rise for another consecutive week. US soybean price was the lowest last week -16 USD/ton cheaper than the price in South America. The Chinese are now in an awkward position to wait for an uncertain production from Brazil and Argentina at a lower price than US, which no longer have the potential for new exports. Throughout the week, the price of Brazilian soybeans rose by 48 USD/ton to 578 USD/ton.

Black Sea Production prices (compared to the previous week):

           months  01-02  03-05  05-07
wheat 12.5% 287(+18) 288(+18) 290(+19)
wheat 11.5% 284(+19) 285(+19) 287(+20)
feed wheat 281(+19) 282(+19) 284(+20)
           months  01-02  03-05  05-07
barley 235(+7) 237(+7) 239(+8)
corn 266(+20) 267(+19) 268(+19)
sunseed oil 1280(-8) 1269(-11) 1273(-5)


Over the past week, FOB prices for Russian wheat and Ukrainian corn have risen sharply. Barley prices have slightly increased and sunseed oil price has fallen after being on a long rise for the last two months.