Could the USDA’s WASDE report drive prices this week? Grain market daily

• UK feed wheat futures (May-25) closed at £176.40/t yesterday, rising £1.20/t from Friday’s close. The Nov-25 contract rose £2.25/t over the same period, to close at £191.50/t. New crop futures prices are now at a £15.10/t premium to old crop.
• UK feed wheat futures closed higher yesterday supported by the global grains market. Chicago wheat and Paris milling wheat futures were up 2.0% and 0.9% respectively. Concern over dryness in parts of Russia and the US was the key driver. However, global economic worries and currency fluctuations are also a point to watch in the near term.
• Paris rapeseed futures (May-25) closed at €481.75/t yesterday, falling €14.00/t from Friday’s close. The Nov-25 contract fell €10.00/t over the same period, to close at €469.75/t.
• Paris rapeseed futures tracked falls across the wider vegetable oils complex. Winnipeg canola and Paris rapeseed futures May-25 were down 6.2% and 2.8% respectively. Canadian canola futures dropped significantly yesterday due to weekend news that China was imposing 100% tariffs on Canadian canola oil and meal.

Uncertainty in global grain and oilseed markets remain, due to pressure from the unpredictability of US tariffs and the resulting potential change in global trade flows, as well as weather updates from the northern hemisphere.

With US trade particularly in focus this month, could this evening’s March World Agricultural Supply and Demand Estimates report (WASDE) provide some direction for prices over the coming days?

What to look out for in tonight’s WASDE

Ahead of the report's release, a Reuters poll suggests that analysts don't expect much change in global ending stocks for wheat, maize and soybeans in the current 2024/25 season, compared to February’s estimates. However, it’s important to remember that maize ending stocks are already at the lowest level in 10-years. As such, a greater that anticipated cut would likely impact prices.

If the US eventually imposes import tariffs on goods from Canada, Mexico and China, and those countries impose retaliatory measures, US exports of maize, wheat and soybeans could end up falling. But as a result of falling US exports, we could see US ending stocks rise. This will have an impact on prices. While it’s unlikely that US export or ending stocks estimates will be adjusted at this point on the back of tariff impact, any changes to these figures for weather or demand related reasons, will be something to watch.

Another watchpoint in this evening’s report will be any changes to South American production estimates of maize and soyabeans. For Maize, Conab estimates the Brazilian maize crop at around 122 Mt, while the USDA in February pegged production at 126 Mt. Similarly, for soyabeans, Conab estimates production at just over 166 Mt, while the USDA expects the crop to reach 169 Mt.

Summary

Ahead of the USDA's March WASDE report, traders' average estimates don't differ much from February's figures, and as such, any significant adjustments will likely drive prices over the coming days. If global ending stocks rise in the March USDA forecast, this could add further momentum to the current downward price trend.

Maize has been a long-term support for feed grain prices since early December 2024, but in recent weeks Chicago futures have fallen sharply, reaching three-month lows. Therefore, changes to South American and US production could be a driving factor.  

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