Price of wheat reaches highest level of the past few years this week at RON 945 per ton

In 2018, the price of wheat had a spectacular evolution, after climbing strongly during the summer, during the harvest and immediately after, with a price increase of over RON 100 per ton in July. Wheat reached its highest price in recent years this week, as its quotation at the MATIF Paris stock exchange was RON 954 / ton (on 15 January 2019) and the CPT price of Constanta offered by some traders in this week being RON 922 / ton.

According to an analysis conducted by AgroGo to see how this season’s price compares with the previous one, we present the chart below for a comparison of the wheat price over the same period of the year for the last 3 seasons.

There is a positive (positive) difference of over RON 200 / ton over the previous season.

What is to be expected next? The wheat price for the new season, which will be harvested in the summer, is now traded on futures contracts (with future delivery) at a lower value than the current one. Thus the current price for wheat with delivery in September 2019 to MATIF is RON 877 / ton, down by about RON 100 / ton on current price.

The futures curve chart below shows the current price for futures contracts for different delivery periods listed on the MATIF Paris:

These prices change every day, but as a rule, the trend only changes when information with significant changes in production or stocks changes significantly.

For those with current wheat stocks, the question remains, what will happen to the price until the production of the new season? If we were to look at what happened in the past seasons during this period (February and March are visible in the first graph), we see that as a rule the price was quite stable, both on stock exchanges and in the physical market.

But this year is a bit atypical, both because we have a season over the average of the last few years, reached this level through a sudden and unpredictable growth on stock exchanges and because in global information (regarding inventories, production and consumption) we are struck by the lack of the famous USDA reports due to the suspension of the US government and, implicitly, of the subordinate institutions.

In this context, the stock market is quite numb (especially the American one). It remains to be seen what will happen next as we approach the maturity of contracts with the following delivery dates, when traders will be forced to make trading decisions.

SOURCE: BUSINESS REVIEW January 2019

Record year for agriculture in 2018: Romania ranks first in EU for maize and sunflower production

The Romanian agriculture sector recorded its best results in history last year, with record yields for wheat, maize and sunflower. The total grain harvest in 2018 – about 31 million tons – ranks Romania on the third place in the European Union (EU), but first for maize harvest for the second year in a row.

Data from the European Institute of Statistics show that Romania ranks third in the EU, after France and Germany, in cereal production, with 31.89 million tons. However, the figures from the Agriculture Ministry are slightly more weighted and indicate only 30 million tons, of which 12 million tons of grain cereal production in the summer.

In maize, Romania is for the second consecutive year on the first position in the EU with a total harvest of 19 million tons, up by almost 33 percent compared to 2017 and with a yield of 7.8 tons per hectare, ahead of France, which gained 12.59 million tons this year.

Romania produces almost 28 percent of the European Union maize. The biggest producer is Agricost (from Insula Mare a Brailei), followed by Comcereal Dolj and Transavia.

For wheat production Romania is on the 4th position in the EU with 10.27 million tons, an increase of 2.36 percent over last year and an average of 4.8 tons per ha. Sunflower harvest rose to 3.35 million tons in 2018, up 15.01 percent over 2017 at a yield of 2.9 tons / ha. This data positions Romania on the first place in the EU.
Last year was also a good year for vineyards, with grapes producing more by 74.08 percent compared to 2017, up to 83.000 tons, with a yield of 9.4 tons / ha, while grape wine increased by 13.3 percent, totaling 1.155 million tons. The average per hectare was 6.7 tons.

The International Organization of Vine and Wine (OIV) estimated at the end of October that Romania recorded a 21 percent increase in wine production up to 5.2 million hectoliters, higher than 2013, the record year so far, when 5.113 million hectoliters were recorded.

On the other hand, there were crops with lower production in 2018. For barley the harvest was down 1.54 percent, the total reaching 1.87 million tons, with a yield of 5.2 tons / ha; for rapeseed oil the production was 1.51 million tons, down 9.46 percent at a yield of 2.3 tons / ha; sugar beet – 921,000 tons, a 21.58 percent decrease and an average of 40.6 tons / ha, and for autumn potatoes the production was 2.4 million tons (minus 10.03 percent) with a yield of 16.7 tons / ha.

SOURCE: Business Review January 2019

European funds available to farmers in the first quarter of 2019

Romanian farmers can access EUR 445.8 million in the first quarter of this year through the National Rural Development Program 2014-2020, according to a press release issued by the Ministry of Agriculture and Rural Development (MADR). MADR, through the Managing Authority of the National Rural Development Program, will open new project reception sessions in the first quarter of 2019.

In the first quarter of this year, funds will be available for Sub-measures (sM): 4.1a – Investments in fruit holdings (EUR 51.013 million), 4.3 – Investments for development, modernization or adaptation of agricultural and forestry infrastructure – irrigation (EUR 200 million), 5.1 – Support for investment in preventive measures to reduce the effects of natural disasters, adverse climatic events and likely catastrophic events (EUR 14.77 million) and 5.2 – Support for investment in agricultural land reclamation and production potential affected by natural disasters, adverse environmental conditions and catastrophic events (EUR 13.68 million).The local infrastructure will also benefit from financing through new sessions for: sM 7.2 – Investments in the creation and upgrading of the small scale basic infrastructure – ITI Danube Delta (EUR 16.78 million), MC 7.4 – Support for investments in the creation or development of rural utilities (EUR 13.76 million) or sM 7.6 – Investments related to the protection of cultural heritage – ITI Danube Delta (EUR 4.99 million).

Local Action Groups will have a new funding opportunity through CM 19.3 – Preparation and implementation of Local Area Action Co-operation (GAL) activities – Component B Implementation of cooperative activities of selected GALs (EUR 9.27 million).

During the same period, sessions for Forestry, Climate and Forest Conservation Services (sM 15.1) and Prime for crop and animal breeding (sS 17.1) will be launched, the total amount of funds available for these sub-measures being EUR 110.15 million.

Romania’s agriculture having its best year in history, with an EUR 8 billion harvest

Romania is going through its best agricultural year in history. Record production of wheat and maize places agricultural turnover close to EUR 8 billion, KeysFin experts say in an analysis of business developments in the sector. Data from the Agriculture Ministry shows that this year’s wheat production is more than 200,000 tonnes higher than last year, exceeding 10 million tonnes, while maize would be between 14.5 and 15 million tonnes, compared to just 11.8 million tons to be harvested in France.


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Romania to register “excellent” maize crop this year amid concerns regarding EU production; wheat quality seen unsatisfactory

Romania is among the few countries in the European Union to post “excellent” maize crop this year, as production in many regions is affected by hot and dry weather over the summer, while poor quality offsets Romania’s large wheat output, according to French consultant Consultancy Strategie Grains, cited by Reuters. Continue Reading…