China upsets the market by canceling wheat supply agreements with the US and Australia

Chinese importers canceled the previously concluded agreements for the supply of large quantities of wheat from the US and Australia, which upset traders.

Thus, the USDA reports that China refused to supply 504 thousand tons of U.S. wheat, which is the largest canceled batch in the history of observations.

Also, the supply of 1 million tons of wheat from Australia was canceled or postponed indefinitely.

On April 9, wheat quotations on the CBOT exchange fell by 2.9 USD/t to 204.9 USD/t, and on Euronext – by 2.75 €/t to 201 €/t.

Market participants believe that Chinese buyers are abandoning previously concluded expensive contracts to purchase new batches at much lower prices. The demand for imported wheat in the country increased after last year’s floods reduced the quality of wheat in Henan province, the main wheat growing region in China.

At the same time, China is not increasing imports of cheap wheat from Russia, whose quality does not meet its requirements, but is increasing purchases of wheat from France and Kazakhstan.

Tags: Australia, Russia, China, Kazakhstan, prices, France, wheat, USA