The Agricultural and Horticultural Development Board (AHDB) has confirmed that grain and oilseed markets have strengthened over recent days.
Over the Christmas period, key grain and oilseed markets were supported.
The firmness in the market was driven by short covering, as traders bought back previously established short positions ahead of the year-end, along with uncertainties about the impact of adverse weather on crops in key producing countries.
From December 20 to December 31, Chicago wheat and maize futures up to May of this year rose by 3.6% and 3.1%, closing at $206.68/t and $183.36/t, respectively.
Paris milling wheat and Chicago soyabean futures, again upo to May of this year also increased by 3.8% and 3.5%, ending 2024 at €239.75/t and $375.61/t, respectively.
This momentum has been maintained into the New Year, specifically where maize and soyabeans are concerned.
According to AHDB analysts, the ongoing hot and dry weather in Argentina is contributing to the firmness in global grain and oilseed prices at the moment.
Weather forecasts suggest these conditions may persist until mid-January, posing risks to the country’s maize and soybean crops, particularly as maize is now in its critical development stage.
Meanwhile in Russia, the state weather agency reported that warmer-than-usual weather is threatening the development of the winter wheat crop in the central and Volga regions,
Grain and oilseed markets
According to the AHDB, the wheat crop in Russia needs to experience a period of dormancy to protect itself from cold temperatures. However, the current milder weather means the crop is continuing to develop.
With a low likelihood of much colder spells, the crop is at risk from excess moisture, with conditions expected to worsen throughout the month.
In the US, a stronger export pace towards the year-end added support to prices. However, forecasts of very cold temperatures for northern parts of the country in the coming weeks could impact the development of winter wheat crop.
While adverse weather conditions are providing short-term support for prices, currency fluctuations and uncertainties over global demand will continue to limit prices rises.
Another major area of concern is the upcoming inauguration of US president-elect Donald Trump, which is a key watch point, particularly in the oilseed complex and maize markets.