Wheat prices ended the week lower as traders started to lock in profits

Despite continued shelling of Odesa’s port infrastructure and uncertainty over exports in the Black Sea region, wheat prices fell on Friday as traders started to lock in profits.

Yes, September futures became cheaper:

• by 4.4% to $256.3/t – for soft winter SRW wheat in Chicago (+5.6% for the week, -5.8% for the month),
• by 1.7% to $316.1/t – for hard winter HRW wheat in Kansas City (+3.9% and 0%),
• by 1.7% to $325.9/t – for hard spring HRS-wheat in Minneapolis (+0.3% and +2%),
• by 0.6% to $237/t – for Black Sea wheat in Chicago (-0.3% and -1.9%),
• by 3.4% to €247.25/t or $275.1/t – for wheat on the Paris Euronext (+6.7% and +3.5%).

Acceleration of harvesting in the Northern Hemisphere increases the volume of supply on the world market, which, against the background of low demand from importers, restrains price growth.

Spring wheat growing regions in Canada, the USA, Siberia and the Urals received favorable rains for crops, which reduced the impact of the weather factor on quotations.

Trying to raise world prices, the Russian Federation continues to manipulate the market and does not publish official data on wheat harvesting, and the Ministry of Agriculture leaves the harvest forecast at the minimum level of 78 million tons (104.2 million tons last year, including the grain stolen in Ukraine).

During the week, the Russian Federation exported 705,000 tons of wheat, and in the season as of July 20, it was already 1.8 million tons. Rusagrotrans predicts that in July exports will reach 4.1-4.2 million tons (including EAEU countries), which will exceed the previous record of 4 million tons in July 2018. Prices for Russian wheat with a protein content of 12.5% increased by 5 per week -10 $/t to $240/t FOB, which corresponds to the level of the minimum price secretly set by the government of the Russian Federation for traders.

Ukraine is speeding up the harvesting of wheat, of which 3.42 million tons were threshed from 831 thousand hectares as of July 21 with a yield of 4.12 tons/ha (2.88 tons/ha last year and 4.11 tons/ha in 2021 on this date).

In the ports of Reni and Izmail, demand prices for food wheat remain at $175/t or UAH 7,000-7,100/t, and for feed wheat at $160/t or UAH 6,500-6,700/t, however, the increase in supply against the background of the drop in the water level in the Danube may lead to a decrease in prices, given the small number of loaded ships.

Tags: Canada, wheat, USA, Ukraine, Russia, prices