The activation of exports from Black Sea ports is returning exporters to the wheat market

Purchase prices for wheat in Ukraine are gradually returning to the level of September-October, when Russian inspectors have not yet begun to artificially block ore ships in the grain corridor.

Despite the current delay in the approach of ships for 2-3 weeks due to queues for inspection, traders are already planning to export wheat for the next 3-4 months, given that farmers will postpone the sale of part of the crop to spring.

In the ports of Ukraine, export demand prices for wheat recovered to $185-210/t or UAH 7,900-8,300/t. At the same time, the prices for DAP – the border with Poland, in two months, the demand prices fell by 15-20 $/t to 240 $/t, following the world prices, and with delivery to Constanta – to 270-280 $/t.

The wheat market is under pressure from the active export of Russian grain, which remains the cheapest on the market. Recent large tenders have shown that Russian wheat is the leader in sales, and traders easily lower selling prices.

According to the IKAR agency, grain exports from the Russian Federation for the week amounted to 1 million tons, and the overall forecast for the season was increased from 42 to 44 million tons. At the same time, prices for food wheat with a protein of 12.5% fell by 3-5 $/t to 305 -310 $/t FOB.

On world exchanges, wheat prices fell under the pressure of the recovery of exports from Ukraine and the easing of some sanctions on the export of grain from the Russian Federation in accordance with the terms of the grain agreement:

• by 0.5% or $1.47/t to $293.7/t – December futures for soft winter SRW wheat in Chicago,
• by 0.4% or $1.29/t to $348.3/t – December futures for HRS durum wheat in Minneapolis,
• by 0.3% or $1.25/t to $317.25/t – December Black Sea wheat futures in Chicago.

December HRW hard winter wheat futures in Kansas City remained flat at $343.3/t, but rose 1.5% or €5/t to €330.75/t or $339.4/t December wheat futures on the Paris Euronext, adding 2% to the price for the week.

The European wheat market is supported by high rates of wheat exports from France, which as of November 21 shipped 6.3 million tons, which is 75% ahead of last year’s rates and the average three-year indicator and is 63% of the forecast for 2022/23 MY. China continues to buy French wheat, although it has recently preferred Australian wheat.

According to the State Customs of the People’s Republic of China, in the 10 months of 2022, the share of Australian wheat in China’s total wheat imports increased to 63% (compared to 28% in 2021 and 15% in 2020) or 4.97 million tons, which is the maximum since 2004 p.

The Agricultural Ministry of India reports that thanks to favorable weather, the wheat sowing area increased by 15% compared to last year from 8.8 to 10.1 million hectares, which will increase production this season.

Tags: Ukraine, China, prices, wheat, India