THE WATCHLIST:
El Niño nerves
Australia starts May with little rain in an El Niño year. US HRW wheat finally has a chance for rain, and so a halt to falling yields. A minor area of Brazil’s second crop corn is a new ‘watch’.
AUSTRALIA
Australia’s winter crop regions remain mostly dry. The extreme south has some moisture. Forecasters expect some more rain in both areas of Victoria and Western Australia this week. Other than that rain, forecasts offer little boost to moisture elsewhere. Now that more of May is within the forecast horizon, the lack of rain is more worrisome. An impending El Niño adds to that worry.
WORLD
WHEAT
Yields likely continued declining in western US HRW Wheat regions last week. Weather forecasters, for the first time in a long while, expect some rain this week in the loss region. Confidence in that forecast is modest, so markets will be watching how these forecasts evolve. The forecast rain is likely too late to boost yields – instead, yields are likely to stabilise below normal. The forecast rain likely capped US wheat prices on Friday. Prices are likely to mirror the evolution of rain forecasts.
Other northern winter crops have adequate soil moisture and are likely in good condition. Australia’s winter crop regions continue to have little moisture as growers plant crops.
COARSE GRAIN
Coarse grain crops continue to have no major issues. Brazil has a small ‘watch’ area, but that is unlikely to have any global price impact. Growers are planting northern summer crops into mostly supportive soil moisture.
OILSEEDS
Oilseeds lack any weather issues for now. Northern summer crop planting is supported by good soil moisture.
Southern Summer Crops
A small section of Brazil’s second-crop corn is on The Watchlist. The region has been dry for a fortnight or so, likely meaning that crops are starting to struggle. Weather forecasters expect little rain in this region for another week. The production at risk is modest in global terms.
Northern Winter Crops
Southern Winter Crops
Watchlist clear for now.
Northern Summer Crops
Watchlist clear for now.
