Drought in Argentina and favorable weather in the US and Brazil will affect markets next week

In the Midwest and Plains of the USA, warm weather has set in with temperatures of 0...+10 ^o C, which will continue next week and will slightly reduce the layer of snow on the fields. However, frosts are not expected in the near future, and precipitation in the form of snow and rain will replenish moisture reserves in the main regions of winter wheat cultivation.

The Central, Southern and Northern Plains will experience heavy rain and snow over the next 3-5 days, reducing the effects of the recent drought in some states.

According to the USDA crop tour, during the month the number of winter wheat crops in good or excellent condition increased by 10-20% to 54-75% (21-66% last year), and only in the southwestern states of Montana, Oklahoma, North Carolina , South Dakota and Texas - decreased by 2-7% to 41-72% (14-22% last year).

Last week's heavy rains in the Delta region raised water levels in the Mississippi and its tributaries, which will increase export barge traffic.

In the main regions of Brazil, there were scattered showers during the week, which will continue next week. They delay harvesting of first-crop soybeans and corn, but improve planting conditions for second-crop corn. The rates of corn harvesting and sowing are higher than last year, but close to the annual average.

Dry and hot weather is prevailing in Argentina for the second week, reducing soil moisture reserves and worsening the condition of soybean and corn crops, reducing yield potential. Temperatures of 30-35 ^o C will have a negative effect on crops that are in the filling phase. According to forecasts, the heat will last another week, and then the rains will pass.

Precipitation will add optimism to traders, but if their amount is insignificant, then local analysts will again significantly reduce production forecasts.

In the south of Europe , in particular in Spain and Italy, there is still a shortage of moisture, while in the north and in the center there are heavy rains. Temperatures will be above normal across most of the continent next week, with precipitation possible in the south.

In Ukraine , periodic rains and low air temperatures contribute to the development of winter crops. According to forecasts, such weather will continue for the next 2 weeks.

In the Russian Federation, heavy snowfalls took place in January, which protected the crops from frost and replenished soil moisture reserves, which allows us to expect a good wheat harvest, especially considering the increase in the area of winter wheat sowing by 5%.