The move follows last week’s largely bearish World Agricultural Supply and Demand Estimates (WASDE) for wheat, noted CRM Agri.
Meanwhile, in this week’s USDA crop progress report, US corn crop conditions lost a further percentage point for combined good and excellent ratings, with now a combined 57% good and excellent.
Similarly, US soybeans also lost one percentage point for combined good and excellent, down to 58% good and excellent.
From a spring wheat perspective, 55% of wheat is now harvested, 20 percentage points ahead of the long-term average, while crop conditions remain encouraging at 64% good and excellent.
Fertilizer and grain price movements are starting to diverge, as seen through the World Bank’s global indices, found a CRM Agri report.
“This poses a downside risk to yields should this trend continue as farmers’ margins and profitability risks being squeezed, alongside a potentially reduced global grain area for harvest-23.
“The knock-on impact less fertilizer usage has on agricultural output could provide a significant boost to prices ahead. Although we expected grain and oilseed prices to edge lower over the next 12-18 months, there remains key upside risks to prices should fertilizer and energy markets remain tight.
“Developments in the war in Ukraine will have a noticeable impact on our forecasts, a resolution to the war this year and a resumption in export pace of grains and rapeseed out of Ukraine should alleviate supply constraints and weigh on prices. On the contrary a protracted conflict and further blockage of food and fertilizer exports out of the Black Sea could fuel another price rally, if global yield prospects take a turn for the worst.”