Russia destroyed Ukrainian grain warehouses on the Danube River in a drone attack yesterday. Local officials reported that three grain warehouses had been destroyed in the Danube port city of Reni during the drone attack. These are near the western coast of the Black Sea and are currently the most important route for Ukrainian grain. One of the terminals struck is on the other side of the Danube River from NATO backed Romania.

The Kremlin said on Monday that “increased vigilance” was needed after the Federal Security Service (FSB) alleged it had found traces of explosives on a ship travelling to Russia to pick up grain. The FSB said the ship had been docked in the Ukrainian port of Kiliia in May, and that it may have been used to deliver explosives to Ukraine. 

Ukrainian Grain Association lobby group has asked European Commission Executive Vice-President Valdis Dombrovskis to increase volumes of Ukrainian grain export via so-called solidarity lanes by 1Mt or 1.5Mt per month. 

UkrAgroConsult estimates Ukraine’s maximum monthly exports via land and Danube ports at 4-5Mt. It is estimated that 2-2.5Mt can be exported via land routes per month, and 2.2-2.6Mt via the Danube ports “It should be noted logistics cost via these routes will be significantly higher than for exports via Ukraine’s deep-water ports.” “This is not a complete replacement for the grain corridor activity, the logistics costs will be more to deliver the commodities to markets in Southeast Asia and China”. 

Agriculture and Agri-Food Canada lowered its 2023-24 all-wheat production forecast by 0.5Mt, to 35.3Mt (33.8m previous year). Durum production forecast trimmed by 0.1Mt, to 5.7Mt (5.4Mt). Barley production cut by 0.3Mt, to 9.2Mt. Maize production forecast lifted by 0.2Mt, to 14.5Mt (14.5Mt). Canola production forecast lifted by 0.4Mt, to 18.8Mt (18.2Mt previous year). 

According to Argentina’s Ag. Ministry, cumulative soybean crush in the first six months of 2023 was at 14.9Mt compared to 20.0Mt over the same period of previous year. Soybean oil production was at 2.8Mt (3.8Mt previous year) and Soymeal output at 10.7Mt (14.4Mt).
Malaysian palm oil futures rose significantly on Monday, with the highest closing price of more than four months, over the news of the Ukraine port attack. 

US private exporters reported sales of 121,000 tonnes of soybeans for delivery to China during the 2023-24 marketing year

Australia

ASX relaxed yesterday afternoon on thin trade to start the week at A$403/t Jan24. Basis was standing up well against the Friday night fall in offshore wheat futures. Canola was not as resilient as the market gave back most of the move on Friday night. Local markets will follow the offshore lead today.

The rainfall forecast for the end of July has thinned out for most of the east coast. The next significant rainfall event is becoming more and more important as the days warm up and the time between the last decent rainfall event increases.