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Market comment - 2015

December 2015

December 2015

Hopes for a trend reversal at the international grain market have been dwindling in the past weeks. Price developments in Chicago and Paris clearly reflect pessimistic price expectations. In Chicago March wheat dropped from 193 $/t in early November to 181 $/t and in Paris from 186 €/t to 178 €/t. In late November/ early December the prices in Chicago were even 15 $/t and in Paris 12 €/t lower for a brief spell. The regional trading centres in the Rye Belt followed the stock exchange price developments less prominently.

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November 2015

November 2015

Following the very strong global supply in the markets for grain and oilseeds, purchasers in the domestic market and in importing countries are seeing no need to worry about the future development. They are confident that they can purchase the volumes and quality they want at any time. There is little fear of supply bottlenecks driving prices upwards. This market view is supported by current reports from the United States Department of Agriculture (USDA) and the International Grains Council (IGC). In its November report the USDA has increased global grain production (including rice) by a further 2 million tons, to 2,476 million tons.

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October 2015

October 2015

Following the strong price decline at the international stock exchanges in the summer months, the market turned around in September. In Chicago December wheat rose from 177 $/t to 186 $/t (165 €/t) and in Paris from 166 €/t to 179 €/t. Despite the worldwide record harvest of 733 million tons (725 million tons in the previous year) and an increase in stores by 16 million tons to 228 million tons, the weakening of prices seems to have stopped. Feed grain has followed the development of the wheat market less prominently.

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September 2015

September 2015

Following the strong downward trend at the international grain markets in July and August prices have stabilised at the stock exchanges worldwide in the first half of September. In mid-September, December wheat traded between 165 and 170 €/t in Paris and in Chicago between 175 and 185 /t. The wheat market in the Rye Belt followed the trend of the international market, with a particularly harsh competition between ports at the Black Sea and the Atlantic.

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August 2015

August 2015

During the past four weeks world market and Rye Belt grain prices have been slumping. In Paris, September wheat dropped by 22 €/t to 165 €/t. This decline was also reflected by the rye market. Due to the apparent changes in the development of world economy and the declining crude oil price, non-agricultural development has a stronger influence on agricultural prices than the supply situation on the agricultural commodity markets.

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July 2015

July 2015

In late June/early July, buoyant share trading came as a surprise at stock exchanges all over the world. In Paris, September wheat dropped by 30 €/t to 207 €/t in 2 weeks and in Chicago by 37 $/t to 227 $/t. The European and American maize markets followed the price rally less prominently. The reason for the boom was the drought in May and June in Western Europe, with a hot spell ranging from the northeast of France to Germany and central Poland, while it was too wet in the USA, too dry in Canada and Australia is expecting El Nino.

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June 2015

June 2015

Prices for grain on the international stock exchanges have been up and down in recent weeks. Since mid-May September wheat in Paris has been moving between 175 and 185 €/t and in Chicago between 175 and 195 $/t. In late June, prices once more reached the upper limit of their range of movement. Unlike wheat, price movements of maize are clearly less pronounced.

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May 2015

May 2015

During the past weeks the downward trend at the world grain market continued. The wheat market in particular came under severe pressure. Wheat prices in Paris and Chicago fell by 20 €/t. The pressure on the wheat market also affected the price movements on the feed grain and rye market. In the Rye Belt rye is following the price development on the wheat market less prominently.

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April 2015

April 2015

Grain prices around the globe have come under pressure in April. In the third week of April the Paris price for May wheat dropped by 10 €/t to 183 €/t and in Chicago the price for Soft Red winter wheat decreased by 6 $/t to 181 $/t. Regional markets followed the prices at the commodity futures exchanges.

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March 2015

March 2015

The political and overall economic development since the beginning of the year has been decisive for grain prices in the Rye Belt. Currencies such as the Euro, Grivnya and Zloty have clearly weakened compared to the US Dollar since the beginning of 2014, the only exception being the Rouble. The Euro has lost 12% of its value compared to the US Dollar since the beginning of 2015, the Polish Zloty 8% and the Ukrainian Grivna (Hryvnia) 41%. Following a currency loss in December, on the other hand, the Russian Rouble stabilised in the first two months of 2015.

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February 2015

February 2015

Following the strong upwards trend of the markets in the last quarter of 2014, the grain market in the Rye Belt has calmed down. After the drop at the start of the year of 10 to 15 €/t, there was a sideways movement for wheat on the Paris stock exchange in February.

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January 2015

January 2015

Impacts of continuing crude oil price drops, the weak Euro, the weather in the southern hemisphere and the Russian export policy have been the focus of discussions in the Rye Belt since the beginning of the year. Following a sharp price increase in November and December a slight decline of grain prices has been observed on the stock exchanges since early this year. The Rye Belt regions, however, show diverging developments.

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