This week, Dan Basse, president of AgResource, asks Noel Fryer, a European-based analyst, to give an update on European and Black Sea crop prospects. “The European market is in limbo,” he says. “With still no decision on whether Russia will maintain its wheat export tax in the new marketing year campaign, neither buyers nor sellers want to take any risk. However, recent rains have brought a big improvement throughout Europe and the Black Sea. With production estimates coming back to levels of last year and a new Russian minister of agriculture, optimism is growing that the export tax will be removed. That will be a huge negative for global market prices.”
Black Sea planting has near perfect conditions, and despite concerns about high production costs, the crop is going in, Fryer says.
Global supplies take some of the pressure of this year’s U.S. crop, which is being delayed in many areas, but markets are keeping a close watch on progress.
Basse adds that the EU is still the world’s cheapest seller of wheat at $5.52; Argentina claims the crown for corn at $4.32 and soybeans at $10.02. Ukraine also is a cheaper source for corn than the U.S. Gulf by about 40 cents.
For AgResource’s full audio, click here.