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Drought in the U.S. is pushing up grain prices

Last week, trading wheat January contract on the Paris Stock Exchange rose 1.3 percent. (week to week) to 273.8 EUR / tone. Also leapt maize - in the week up 0.9 percent. to 255.8 EUR / tone Last week saw the price appreciation of the CBOT. Here, the December wheat contract cost the U.S. $ 319.4 / t, ie by 2.8 percent. more than a week earlier, and corn in the next contract - 295.9 USD / ton, an increase of 1.4 percent. more.

Recent increases in cereal stock quotes are probably primarily due to continuing adverse conditions for winter wheat crops in the United States. Drought affects the condition of winter crops, and this translates into price increases in the market
American, probably copied by MATIF.

The slowly declining export competition from the Black Sea basin countries, especially in the wheat market. U.S. and key European exports increase exports, which encourage high prices. This week the European Commission issued export licenses for 437 thousand tones of wheat
soft, which should be considered a very good result weekly sales. At the same time the EU increases import corn. Weekly imports of this species (based on issued licenses) amounted to 573 thousand. tons.

According to the Reuters agency in the near future, competition in world exports of wheat can still weaken. USA, currently the biggest rival Union wheat exports (after a good harvest this species), could soon face a lot of logistical problems due to too low water in the river Mississippi, which floated an American grain to the ports of the Gulf of Mexico. Prolonged drought causes the lowering of water levels in rivers. Logistical problems may occur in December and January.