The EUR/USD currency pair dropped to 1.0565, while the price of US WTI light crude oil rose to 68.43 USD per barrel.

Oil prices increased on Wednesday due to signs of limited supply in the near term. However, prices remain close to a two-week low. Declining demand forecasts and weak performance from major consumer China continued to weigh on market sentiment. The absence of more direct fiscal stimuli for the Chinese economy casts a shadow over oil demand prospects, alongside expectations of increased U.S. production under a potential second presidential term for Donald Trump and emerging plans by OPEC+ to boost output.

Yesterday, CBOT December wheat futures dropped by 11 1/4 cents to $5.41 per bushel. Wheat futures continued to fall in both Chicago and Paris. Rainfall persists in the US Wheat Belt, with additional amounts of 25-50 liters per square meter expected. Rusagrotrans predicts Russia's winter wheat areas to decrease to a low of 15.4 million hectares, the smallest since 2018/19. The Rosario Grain Exchange forecasts Argentina’s 2024/25 wheat production at 18.8 million tons (down by 0.7 million tons from previous estimates). Sovecon's initial forecast for Ukraine's 2025/26 wheat production is 21.1 million tons, below the five-year average.

Analysts estimate that Russia’s grain export quota for February 15 – June 30, 2025, may range from 5 to 17 million tons, likely around 11-12 million tons. The 2024 export quota was 28 million tons, 25.5 million tons in 2023, and 11 million tons in 2022, including 8 million tons of wheat. Export volumes in November to January will be crucial. Overall grain stocks in Russia are limited, winter wheat areas are reduced, and crop conditions are poor. Russia is expected to significantly slow wheat exports in the coming months, following a trend started by Ukraine. Next, Romania and Bulgaria may come into play, but their export potential is relatively small.

December corn futures in Chicago fell by 2 cents to $4.26 1/2 per bushel, with corn futures also declining in both Chicago and Paris. The USDA reported private export sales of 401,357 tons of corn to Mexico and another 290,820 tons to an unknown destination. Ethanol production data for the Unoted States will be published today. South Korean importers purchased 133,000 and 138,000 tons of corn without a specified supplier. The Rosario Grain Exchange reduced its forecast for Argentina’s 2024/25 corn production by 1 million tons, to 50-51 million tons. Algeria bought 240,000 tons of feed corn from Brazil or Argentina with November delivery, followed by a new tender for another 240,000 tons with December delivery. Sovecon raised its forecast for Ukraine’s 2024/25 corn production by 1.6 million tons to 25.1 million tons, with export estimates up by 1.3 million tons to 20.3 million tons. The EU corn export quota is nearly exhausted, with volumes likely redirected to China.

Analysts note that while Brazil’s corn crop has grown, it cannot offset the increase in domestic consumption, leading to a reduction in exports. Although Brazil recently surpassed the U.S. as the world's top corn exporter, the roles may soon reverse. Despite expectations for rising exports, Brazil has seen increased domestic corn consumption, driven largely by ethanol production. Brazil's ethanol plants are expanding rapidly, and farmers are struggling to meet demand. Brazil is likely to rank as the third-largest global corn exporter after the United States and Argentina. The USDA and Conab’s production forecasts for Brazil have differed significantly, with the shrinking exports lending weight to Conab’s projections. Next season, Brazil’s corn acreage is expected to be 52 million acres (down from 55 million acres last year). In the broader context, production issues are noted in the EU, Ukraine, and Russia, while only the U.S. and China have seen stable yields this year. Tight corn markets are expected for both 2024/25 and 2025/26. While earlier forecasts anticipated ample supply and U.S. farmers faced challenges in securing sales, the market outlook has since shifted.

Chicago January soybean futures fell by 2 3/4 cents to $10.07 1/4 per bushel. The soybean complex in Chicago, rapeseed futures in Paris, and canola futures in Canada all saw declines. The US may take a more reserved stance on biofuel policies. Cofco projects a 9.5% drop in China’s soybean imports for 2024/25 compared to 2023/24, down to 98.8 million tons. The Rosario Grain Exchange forecasts Argentina’s soybean production at 53-53.5 million tons, while Conab will release its forecast for Brazil today. Indonesia has confirmed its B40 biofuel plan for January 2025, with a likely B50 target by 2026.

According to ProZerno, Russia’s sunseed production in 2024 will be 15.8-15.9 million tons (down from 17.3 million tons in 2023). The soybean production will reach 7-7.1 million tons (up from 6.8 million tons), while rapeseed is expected to yield 4.7-4.8 million tons (up from 4.2 million tons). Ukraine’s Agricultural Business Club forecasts a 2024 sunseed production in Ukraine of up to 10.8 million tons (down from 15 million tons in 2023). By November 8, 2024, 95.2% of Ukraine’s sunseed areas had been harvested, yielding 9.7 million tons. Quick calculations suggest a final yield of 10.2 million tons, considering approximately 1.5 million tons of sunflower seeds typically remain unregistered each year. Both countries are seeing a combined sunseed production reduction of 5.7 million tons or 17.6% compared to 2023.