Wheat prices rise in Ukraine amid logistics problems, both rail and road

The wheat market is experiencing an increase in prices due to a shortage of grain in ports and logistics problems. White Brokers writes about this.

Feed wheat rose to $214–215/t on DAP-port terms, which indicates increased purchases by traders who want to close short positions. Food wheat also rose by $1 to $220–225/t, depending on the quality and direction of delivery.

“The increase in demand from exporters is explained by the need to quickly form ship batches and fulfill already concluded contracts. At the same time, major difficulties with railway logistics lead to an extension of the time for delivering wagons to ports, which stimulates demand for “live” goods on the superspot,” brokers note.

Road logistics is also under pressure — rising transportation costs, a lack of available transport, and carriers’ defaults on contracts. As a result, traders who operate primarily in the domestic market face uncertainty about shipping costs and risks of supply disruptions, which limits supply at ports and, as a result, keeps prices high.

Tags: wheat, logistics, rail transportation, prices