Market Morsel: Oh là là, French crop to impress.
Market Morsel
In one report today, I discussed the wheat conditions in the United States (see here). However, they aren’t the only player in town. There are still the French to consider, and they are polar opposites to their Kansas cousins.
The chart below shows the French wheat conditions for the current week, compared to the same periods since 2012. These conditions are the percentage that is bonnes/tres bonnes or for us English speakers good/very good.
The wheat crop is currently 93% good/very good, the highest since 2015. It is important to note that conditions can change quickly. The second chart shows last year’s season, which fell from this time of year from 82% to 63% good/excellent. This year, however, seems to look much more likely to perform than last.
We are currently seeing Matif wheat futures fall to a historically high discount to Kansas futures, as conditions in the French look parfait versus poor in Kansas.
The severity of the conditions in the US can be seen by the fact that US buyers have purchased 210kmt of wheat from Europe for shipment to the USA over the next couple of months.
