No escape velocity

Weather issues around the Black Sea are widening – but are not yet enough to lift prices much.?

AUSTRALIA

Most Australian winter crops will likely have sufficient soil moisture a week or so from now.?

The exceptions have whittled down to WA’s Esperance and SA’s West Coast.?

Australia’s new-crop pricing still likely stays in a normal-season regime.

WORLD

Northern summer crop worries around the Black Seas will widen in the next week.?

We've added dry summer crops regions in Romania and Bulgaria to The Watchlist.

And the dry regions in Russia and Ukraine will expand.?

The issue is large enough to garner the market’s attention.

But it is not, yet anyway, enough to boost global prices by much.?

Some localised worries about US cotton and US White Winter Wheat remain.

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AUSTRALIA:? Normality for now

Most Australia’s crop regions will likely continue to have enough soil moisture.

• Weather forecasters expect useful rainfall in most regions over the next week or so.?
• The good news is that the exceptions list shrank.
• We removed the ‘alert’ for north-west Victoria and south-west NSW.
• This area received unexpected, but very welcome, rain last week. ?
• The remaining exceptions, WA’s Esperance and SA’s West Coast, unfortunately remain dry.?
• Crops in those regions are likely struggling to start.?

Australia’s winter crop forecasts are now likely stable.?

• Soil moisture in many places remains modest.?
• ‘Watches’ are thus still more likely to emerge than usual. ?

Australia’s winter crop season is looking okay after a slow start.? Some areas still have serious moisture shortages. ?The scale of those issues though is modest. ?New-crop pricing likely continues settling into a broadly normal seasonal pattern for now.?

WORLD: No escape velocity

Dry weather concerns around the Black Sea are material.? But are likely not yet enough to put a dent in forecasts for comfortable supply.? So, the worries are unlikely to boost prices from the doldrums.?

Northern winter crops

More of the US white winter wheat region will close on yield losses in the week ahead.?

• Much of this region now has zero soil moisture.?
• And that will not change this week.?
• Weather forecasters again expect little rain and extremely high temperatures this week.?
• Some yield decline in Oregon and Idaho is likely imminent.?
• Crop yields likely continue declining in central Washington too.?
• Importantly, much irrigation in the alert region is an offset.?
• And, further limiting the impact, it is late in the season
• The scale of the losses though is likely modest in global wheat terms.?

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Russia’s south and Ukraine’s east face another warm and dry week.?

• Approaching mid-July though, crops are mature and being harvested.
• So, any (further) losses are likely limited.?

US white winter crop losses are likely providing a little support for wheat prices.? The losses though are unlikely to be large enough to lift prices much.?

?Northern summer crops

Summer crop concerns around the Black Sea are widening.?

Europe’s south-east has dried down dramatically in the past week.

• Weather forecasters expect little rain and very high temperatures for another week or so.
• Bulgaria’s east and Romania’s south are among the worst affected areas.
• Young crops there will likely experience increasing stress for at least another week.
• We have thus placed these regions on ‘watch’.?

This same weather pattern is affecting southern Ukraine.

• We have thus expanded Ukraine’s ‘watch’ region to include Kherson.

Southern Russia is suffering similarly.

• And the dryness is now creeping northwards into the Volga River basin.?
• We thus added the Saratov region on ‘watch’.?

Together the three watch regions account for a material share of corn and oilseed production.?

That fact means the region’s fortunes will be on the market’s radar.?

Some US cotton regions remain on ‘watch’.?

• Adjoining regions of Texas and south-west Oklahoma were already on ‘watch’.
• We have added Texas’ Blacklands region this week.?
• Weather forecasters expect little rain and high temperatures over the next week or so.?
• That combination likely sees soil moisture drop dramatically.?
• Young cotton crops in these regions will thus likely suffer stress.?
• These regions are material cotton producers but are at US and global scale.
• The worries are likely enough to stop cotton prices weakening vis-à-vis other crop prices.?

Northern summer crops weather worries will expand this week.? The amounts at risk are likely enough to at least support regional basis.? But perhaps not yet enough to cause more than a ripple for global prices.? So, these weather worries are unlikely enough to lift feed and ‘seed prices from their 2024 doldrums.?

Southern winter crops

Argentina’s winter crop regions could do with some rain.?

• The lack of moisture is not an immediate issue.
• Another fortnight though without rain means crops struggle to start.?
• Forecasters expect little rainfall in most of those regions over the next week or so.?
• We have thus put some regions in Santiago del Estero on ‘watch’.?
• The ‘watch’ area produces a modest amount of wheat by global standards.?
• The global market impact, for that reason, will likely be negligible.?

Brazil’s emerging winter wheat crops have enough soil moisture.?

Southern summer crops

Southern summer crops harvesting is proceeding apace.? The chances of any market-scale weather event are now very low.? The Watchlist will resume tracking southern summer crops later this year.?