Back to square one for the course of cereals.

Six months after the start of the invasion of Ukraine, wheat and maize are approaching their pre-war prices, in a market that is finding "a point of equilibrium".

The worst-case scenario, with its “famine hurricanes” feared by the UN, has been avoided but prices remain very high.

Wheat prices had soared to nearly 440 euros per tonne on the European market in mid-May - double last summer - while merchant traffic was almost at a standstill on the Black Sea.

But they fell back to around 330 euros in August.

A relaxation "started at the end of May-beginning of June"

“The markets have learned to live with the crisis.

The easing began at the end of May-beginning of June with the first reassuring production estimates in Europe and the resumption of exports from Ukraine,” explains Gautier Le Molgat, analyst at Agritel.

Ukraine is "on track to export almost 4 million tons of agricultural products in August", all routes combined, approaching the more than 5 million monthly before the war, a department official announced on Tuesday. of American state.

This acceleration in exports from Ukraine, an agricultural superpower which, along with Russia, accounted for 30% of world wheat trade at the end of 2021, is the result of the agreement signed on July 22 between kyiv and Moscow, under the aegis of the UN and Turkey.

This agreement for the opening of a maritime corridor is intended to release more than 20 million tonnes of corn, wheat and sunflower stored in Ukraine.

According to the Joint Coordination Center which oversees the corridor, 721,449 tons have already left the country by sea.

For the moment, this easing is benefiting Ukraine more than Russia, which is preparing a strong comeback on the markets thanks to an exceptional wheat harvest, estimated at 88 million tonnes.

Russian wheat exports for July and August are down 27% year on year, according to estimates by Russian consultancy SovEcon.

Russian wheat is still too expensive and faces stiff competition, particularly from French wheat, for several reasons: high transport costs, a "strong rouble", a falling but still "very high" Russian export tax (approximately 80 dollars per ton), explains Andrey Sizov, managing director of SovEcon.

Weak Russian exports have been a major factor behind the high prices, he believes, in a crisis that has been less about availability than price and logistics.

The threat of inflation

On the ground, the July agreement should promote an overall resumption of flows in the Black Sea, with the fall in insurance premiums which were a brake factor for charterers.

Prices are still very high.

The causes of the post-Covid outbreak are indeed still there: rising costs of energy, fertilizers (the price of which has tripled in one year), and transport.

And to this is added “the sword of Damocles of inflation” underlines Edward de Saint-Denis, broker at Plantureux & Associés.

If analysts see the price of wheat continuing to decline in the medium term, they are more circumspect for corn: the drought that is raging everywhere is worrying.

The European Union estimates its corn production down by 16%, while the United States has revised its yields downwards in certain regions, notably in Nebraska and South Dakota (-21.7%).

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