Following on from the supportive USDA crop progress report at the start of the week, and grains and oilseeds and continued to trend higher today.
Weather in central Brazil is continuing to raise concerns with dry conditions for second corn and seasonal dryness approaching, while vegetable oil continues to push higher, supporting oilseeds due in part from palm oil supply concerns.
In the latest USDA GAIN report for the EU, the USDA is expecting a slight contraction in overall wheat area, and production in 2022/23 to decline to 135.3Mt, down from 138.3Mt in 2021/22, predominantly due to contractions in planted area in France and Spain.
For corn, and the USDA is also expecting a small decline in production next season, down to 67.5Mt from 70.5Mt this season. Like with wheat, an area decline is expected, especially in Romania and France due to competition with sunflowers, in part due to high prices and lower input costs.
