The weather in the United States took a toll on the developing winter wheat crop, which deteriorated to its worst condition for this time of year in 17 years. “The market here only has eyes for the cold and wet weather in the United States,” a trader said. “Right now we can say the market is overly cautious,” he said, adding that it will take another 10 days before gauging the actual impact.
Rain around the US Midwest kept farmers out of fields last week matching the slowest corn planting pace ever, government data released on Monday showed. The US Agriculture Department said on Monday corn planting, as of April 28, was 5 percent complete, just 1 percentage point ahead of where farmers were a week ago. The pace was the slowest since 1984, when farmers also had completed just 5 percent of their corn planting.
“We were expecting corn plantings to have reached 9 percent, we are very disappointed,” another trader said. Dealers were also keeping a close watch on conditions in key exporter Russia. “Russia is said to expect a hot dry May and that will increase risks to the grain crop. In 2012, Russia lost a quarter of its crops due to drought in the second half May and early June,” UK grain merchant Frontier said in a market note.
In France, the European Union’s largest wheat producer, temperatures have dropped sharply since last week and were set to remain below average in the large grain regions in the North until Thursday. German prices were supported by the surge in Paris but premiums over Paris melted into discounts partly because of the dim export outlook. Standard milling wheat for May delivery in Hamburg was offered for sale unchanged at 251 euros a tonne.