More US wheat moves to China with fifth straight week of exports

17:17, 24 December 2020

New Delhi — China moved in more wheat from the US ports in the week that ended Dec. 17, registering a fifth straight week of US wheat shipments, indicating Chinese buyers’ interest in US wheat has not waned as the country looks to meet its trade obligations and replenish its reserves.

In the week that ended Dec. 17, the US shipped 63,000 mt of wheat to China, US Department of Agriculture data showed Dec. 23.

After a pause in trade seen in the months of September and November as buyers awaited US presidential election results, China has been shipping in more than 60,000 mt of wheat every week since Nov. 19, data showed.

This takes US wheat exports to China hitting 1.6 million mt level in the 2020-21 marketing season, which started June 1.

Overall, China remains the third-largest buyer of US wheat in 2020-21, with total commitments hitting a seven-year high 2.2 million mt, according to USDA data. Total commitments include outstanding sales and accumulated exports.

Mexico, the Philippines, and Japan have been traditionally large buyers of US wheat in recent years, but China’s grain demand has been keeping the markets busy for months.

Analysts have already indicated China’s grain hunting is expected to continue in 2021 amid the country’s plans for further strengthening its food security and meeting burgeoning domestic demand.

China’s grain demand is getting a big push from the positive signals around its pig herd recovery after the African swine fever outbreak destroyed a major portion of its pig population in the last two years.

US wheat sales

Total US wheat commitments from Mexico during the 2020-21 season hit 2.7 million mt in the week ended Dec. 17, as the country stretched its lead over the Philippines, according to the USDA data.

Mexico was the top buyer of US wheat in 2019-20, but the Philippines dominated most of the current season, with commitments for US wheat reaching 2.5 million mt in the week ended Dec. 17, according to the data.

Total US wheat sales in the week ended Dec. 17 fell 27.1% week on week to 393,686 mt, continuing the dipping trend seen at the same time last year.

Nigeria emerged as the top buyer of US wheat in the week ended Dec. 17, with sales hitting 102,000 mt, taking its 2020-21 total commitments past the 1 million mt mark, according to the export sales data.

With the marketing season in its 29th week, total commitments for US wheat shipping to global destinations have now reached 20 million mt, hitting 74.8% of USDA’s US wheat export target for 2020-21.

The USDA is expecting the US to export 26.8 million mt of wheat in 2020-21.