But EU and UK wheat futures took a slight knock yesterday. Expectations of a bumper wheat crop out of Russia remain intact, which is likely limiting the upside price potential for European wheat prices, found a report from CRM Agri.
There is growing momentum in grain exports out of the Black Sea—and some alleviation of supply tightness, said the analysts.
Though it must be stressed, said the CRM Agri team, that while exports out of Ukraine have slowly started to resume, long-term confidence in a sustained pace of shipments is still a long way off with a great deal of risk for disruptions ahead as the war rages on.
The supply of corn from Ukraine remains a concern, which, coupled with deteriorating EU supply due to recent drought-impacted crops, is also providing underlying support, they said.
Turning to the US market, and the team provided a mixed outlook for US corn amid drought conditions in central states, along with reduced export demand and growing concerns over a global recession.
Bearish outlook for rapeseed markets
In their outlook for oilseeds, the analysts said they remain relatively bearish toward rapeseed markets due to higher global supply and a fading premium for rapeseed oil over other vegetable oils.
“Nevertheless, should the current flow of exports of oilseeds out of Ukraine become restricted once more, then heightened volatility and price recovery is likely.”
As regards the soybean market, the analysts expect volatility to be heightened for now, as US production uncertainty remains with a greater potential for temporary bullish market moves. “But overall, 2022/23 continues to present a bearish supply outlook.”
