Insight Focus
The oil selloff has dragged grains lower. Fading concerns over US corn planting delays aligned with falling crude, pushing all grains down. Ahead of the May WASDE, higher fertiliser costs point to lower yields, slightly reduced acreage, volatility, and consolidation near USD 4.5/bushel for Chicago corn.
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All grains moved lower, dragged down by plummeting oil prices and the disappearance of the risk of planting delays in the US.
The selloff in crude last week dragged most markets lower, including grains, which plummeted both in Chicago and Euronext. After a strong Monday, the selloff in oil that started on Tuesday dragged all markets down. Regionally, Euronext saw bigger losses than Chicago.
The May WASDE will be released this week, and the question is whether it will already reflect any impact of higher fertiliser costs in terms of lower yields. For the northern hemisphere, it is too late for fertiliser prices to return to affordable levels, no matter what happens with peace in Iran. The damage is done.
Expect some volatility ahead of the WASDE, but overall, we think there is a risk of lower corn yields and a slight reduction lower in corn acreage in the June acreage report. Expect further consolidation around USD 4.5/bushel for Chicago corn.
There are no changes to our forecast for Chicago corn to average USD 4.4/bushel during the 2025/26 (September/August) crop. The average price since September 1 is running at USD 4.3/bushel.
US Planting Progress Eases Market Concerns
The week started with the US crop progress report showing a strong advance in corn planting. This is despite anticipated delays at all in planting progress due to rains in the corn belt.
Source: USDA
While Chicago corn found a floor on Thursday and then traded sideways on Friday, Euronext corn plummeted every single day last week, pressed lower by a stronger Euro.
US corn is 38% planted, in line with last year and above the five-year average of 34%. Corn planting in France is 86% completed compared to 77% last year and the five-year average of 74%. Corn planting in Russia is 25.3% complete, far below the 48.1% planted last year. Corn planting in Ukraine is 30.5% complete compared to 47.7% last year. Corn harvesting in Argentina is 30.1% complete. Summer corn harvesting in Brazil is 66.7% completed, lower than both 73.3% last year and the five-year average of 70.3%.
US Wheat Conditions Stabilise with Minor Uptick
Wheat mirrored corn, with bigger losses in Euronext due to the impact of currency.
In the case of US wheat, and following expectations of worsening conditions due to dry weather in some growing regions, the USDA crop progress report also delivered a surprise, with conditions improving, although by just 1 percentage point.
Source: USDA
US winter wheat is 31% in good or excellent condition, up one point week on week but much lower than last year’s 51%. French wheat is 80% good or excellent, one point lower week on week but higher than 74% last year. Ukraine spring wheat is 95.5% planted compared to 91.4% last year. Russia spring wheat planting is 9.9% complete, compared to 25.9% last year.
Brazil is expected to be rainy and cold in the south, and rainy in some parts of the centre-west. Frost is expected in Argentina. Rain and colder weather are expected in western Europe, while the Black Sea region is expected to be mixed, with both rain and changing temperatures. The US is expected to remain dry in the central and western regions, while the south is expected to receive a good volume of rain.
