The EUR/USD currency pair fell to 1.0658. The price of US WTI light crude oil dropped to 68.04 USD per barrel.
Oil prices declined on Monday as the threat of supply disruption due to severe weather in the United States diminished. Additionally, a recent economic stimulus plan for China disappointed investors. The stimulus package announced by Beijing following the week-long National People's Congress on Friday did not meet market expectations. ANZ analysts noted that the absence of direct fiscal stimulus suggests that Chinese authorities have left room to assess the impact of policies to be implemented by the next U.S. administration. Oil consumption in China has seen minimal growth, as the country’s economic growth has slowed, gasoline use has declined with the rise of electric vehicles, and liquefied natural gas has replaced diesel as truck fuel. Citi strategists expect the U.S. Federal Reserve to cut key interest rates by 50 basis points at its December meeting, noting that this week’s October inflation report is unlikely to alter the central bank’s policy direction.
Yesterday, crop prices in Chicago declined following a round of profit-taking, with wheat being the hardest hit due to recent rainfall in the United States.
December wheat futures in Chicago dropped by 7 cents to $5.65 1/2 per bushel. Wheat futures in Chicago decreased, while futures in Paris were mixed. The sharp rise in the US dollar weighed on the market, with new rainfall in the southern plains of the United States putting downward pressure on prices. These rains are expected to improve crop condition ratings due out on Tuesday. According to Rusagrotrans, Russia is forecasted to export 4.55 million tons of wheat in November (compared to 3.49 million in November 2023). Wheat harvesting in Australia is picking up pace due to favorable weather, while South Korea purchased 65,000 tons of feed wheat from various origins.
Last week, Russia exported 0.77 million tons of grain (down from 1.2 million tons the previous week), including 0.72 million tons of wheat (down from 1.12 million). At the end of last week, the export price of Russian wheat was 228 USD/ton (down from 232 the previous week), well below the set prices of 245 USD/ton for November and 250 USD/ton for December. There is still ample wheat in the Black Sea region, resulting in high competition.
CBOT December corn futures dropped by 1 cent to $4.30 per bushel. Corn futures in Chicago and Paris declined. Due to a holiday, U.S. export inspection data and campaign movements were delayed until Tuesday. In Brazil, the first corn crop has been planted on 72% of planned acreage. Mexico has been a strong buyer of US corn, especially in recent weeks, due to an anticipated new trade dispute with the United States. The corn market remains stagnant, with farmers holding back sales while traders turn to imports. Bulgaria imported about 13,000 tons of corn last week.
APK-Inform maintains its forecast for Ukraine’s grain production at 52.5 million tons, with exports expected to reach 37.3 million tons (compared to 51 million in 2023/24). Since the beginning of the season, Ukraine has exported 15.3 million tons, an increase of 52% from 2023/24, including 5.3 million tons of corn (+24%). However, with the depletion of reserves, a significant drop in exports is expected by the end of the season.
Chicago January soybean futures fell by 8 cents to $10.22 1/4 per bushel. The soybean complex in Chicago decreased, while rapeseed futures in Paris and canola futures in Canada increased. Soybean planting in Brazil reached 67% of the planned acreage (up from 54% a week earlier and 61% in the previous season). New rainfall in Brazil is expected to reach areas that have remained relatively dry. In October, Brazil exported 4.71 million tons of soybeans (-15.9% from October 2023’s 5.6 million and 6.11 million in September), according to Secex. Brazilian soybean export supply is declining. In October, China imported 8.087 million tons of soybeans (-29% compared to September). Soybean meal stocks decreased by 1.3 million tons to 0.98 million tons. China is experiencing an increase in soymeal prices due to this sharp drop in stocks. In October, Malaysia’s palm oil stocks fell to 1.885 million tons (down from 2.012 million in September), with production at 1.797 million tons and exports at 1.732 million tons.
The European Commission forecasts that the EU’s 2024 sunseed production will be 8.1 million tons, 17% less than in 2023, marking the lowest level since 2015. Romania’s production stands at 1.2 million tons (down from 2 million previously), a very low yield overall. In Ukraine, most forecasts estimate a sunseed production of 12.5 million tons, though official data indicates only 9.6 million tons harvested so far, with 95% of acreage cleared. The figures increasingly reflect the reality of low harvests, high consumption, and rising prices. Rapeseed futures rose at the start of the week despite a decline in soybeans in Chicago. Rapeseed prices on Australia’s eastern coast increased by 15 USD/ton last week to 812 USD/ton, with further rises expected.