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The cereal market has spent the summer in a quiet slumber, with cheap and fairly stable prices given the volatility we are accustomed to. Even so, drawing a parallel with the preparation of any dish, this recipe is not without risks that could ruin all culinary excellence, turning the kitchen into a laboratory under constant tension.
To start, the base of our recipe would be the abundant wheat harvests in both Russia and Ukraine, both of which exceeded expectations. But like any good stew, ingredients alone aren't enough; you have to stir them. And this is where we mustn't forget that logistical risk, that bitter spice imposed by the war in Ukraine, continues to have an impact. We could compare the Black Sea to a hot oven: a few minutes too long and the dish is ruined.
To the stew we should add an all too familiar ingredient: the tariff war between China and the United States. We could even start talking about a return to protectionism on a global scale, which puts trade as we know it in check. As if that weren't enough, and to add a touch of acidity, a court in the United States has ruled that Trump could not invoke emergency powers, which would invalidate the tariffs. Likewise, doubts about the future independence of the Fed add a bitter taste to the dish.
Meanwhile, the pace of U.S. corn exports remains slow. Trade tensions have led buyers to seek more secure contracts in Brazil—a major beneficiary of the situation—which is already making rapid progress in planting corn for the 2026 safrinha harvest. Russia and Ukraine are also becoming alternative sources.
Now for the spices in the stew, straight from the Middle East, adding instability with active conflicts that disrupt energy and food routes. We can also add another spice, the new good relations between China and India, whose image, alongside Putin last week, stirred the pot of multipolarity, seeking to diminish the economic and political importance of both the United States and Europe, which, if I may say so, seems to remain in the refrigerator, unaware that the dish is about to be served.
To all this, we must add a sauce, a financial reduction with poor economic data in both Germany and France, where the government has fallen and it seems that they are heading in no clear direction. The economy is cooling, debt is overflowing, and reforms that have been pending for years are becoming increasingly difficult for the electorate and the markets to digest. The reduction should be salted with the sudden increase in 10- and 30-year U.S. Treasury bonds (the main ingredient of the global economy from which all menus are prepared).
And what about local consumption? Just like everywhere else! September marks the end of summer vacation, those extra pounds, and those promises to finally go to the gym and diet. In short, consumption is generally low, but the fridge (the ports) is full.
How would we describe our stew? A dish laden with uncertainty, with flavors reminiscent of large-scale global wheat, corn, and soybean production, but which retains an aroma of tension. The risk lies in the cooking process. Do not leave the stew unattended.
