Dry weather in Ukraine, Australia and Argentina will affect agricultural markets in the near future

In the main countries – exporters of grain and oil crops, the drought is intensifying, which threatens to reduce the harvest potential, in particular in Australia and Argentina in 2023/24 MY and in Ukraine in 2024/25 MY.

According to the Ukrhydrometeocetr, there were no significant precipitations in most territories of Ukraine for 40-55 days, so the soil drought intensified against the background of higher than normal temperatures. In September, the optimal terms for sowing winter cereals ended, and the conditions on the sown areas were critical. Due to the lack of moisture, winter wheat seeds in many regions have not germinated for a month. Light rains will pass over the weekend, but significant precipitation is not forecast for the next 7-10 days. At the same time, dry weather favors the harvesting of sunflowers, soybeans and corn, the moisture content of which is 14-15% compared to the usual 20-25%, which will reduce the costs of drying for farmers.

In Argentina , dry weather favors the sowing of corn, but creates unfavorable conditions for obtaining seedlings. Deficiency of precipitation has a negative effect on the pouring of wheat grain. In the next 7-10 days, dry weather is expected in the country with little precipitation, insufficient for the germination of soybeans and corn.

A cold front has brought heavy rain to south-east Australia this week, but in other regions rainfall has been insufficient, so conditions for winter wheat and canola are generally unfavorable. Dry weather next week will continue to reduce crop potential. The country’s government expects that this year the income of local farmers will decrease by 41% to the lowest level in the last 3 years due to the El Nino weather phenomenon.

In the Midwest and the US Plains, a cold front will bring lower temperatures and precipitation during the week, which will improve crop conditions. Soybean and corn harvest rates are above average, and high temperatures reduce grain moisture and losses. Temperatures will drop next week, but dry weather will help the harvest.

In southern Brazil , the rainy season continues, and heavy downpours in some places lead to flooding and the need to replant corn. Rainfall is below normal in the central regions, but farmers are stepping up planting of soybeans and corn in anticipation of more rain.