Exchange prices for wheat fall in anticipation of the USDA report, and in Ukraine they even rose

A significant supply of cheap Black Sea wheat limits the growth of prices for European and American wheat.

In Ukraine, wheat prices rose slightly against the background of reduced supply and active exports, which in 2023/24 MY (as of April 8) reached 14.3 million tons, out of the USDA forecast of 16 million tons, which is 7.2% higher than last year’s pace.

Purchase prices for fodder wheat increased by UAH 100-200/t to UAH 6,700-6,900/t or $154-157/t, and for food – to UAH 7,500-7,800/t to $170-175/t with delivery to ports . Individual traders offered $173-176/t for fast delivery of wheat with 11.5% protein, but overall the volume of food wheat offers is very low due to the poor quality of the 2023 crop.

Warm weather accelerates the sowing of spring crops in Ukraine, while the condition of winter wheat crops is much better than last year.

During the week, wheat stock prices rose on forecasts of a reduction in planted areas in the US, but they fell yesterday in anticipation of the USDA report and against the backdrop of favorable weather in Europe and the US.

May futures fell in price yesterday:

• by 1.4% to $205/t – for soft winter SRW wheat in Chicago (+2.4% for the week),
• by 1.4% to $212/t – for hard winter HRW wheat in Kansas City (+2.5%),
• by 0.1% to $239.2/t – for hard spring HRS wheat in Minneapolis (+3.7%).
• by 1.4% to €201/t or $233/t – for wheat on the Paris Euronext (+5%).

Next week, warm weather and periodic rains will accelerate planting in the US, where as of April 7, 3% of the planned area was planted with spring wheat (1% last year). 56% of winter wheat crops are in good or excellent condition, the same as a week ago, although last year there were only 27%.

The Federation of Indian Flour Mills lowered the forecast for the wheat harvest in 2024 to 105 million tons, which would be 6.25% less than in 2023. At the same time, Agricultural Ministry of the country left its forecast at 112 million tons, which will almost correspond to the record level of 2023 – 112.74 million tons, while the USDA forecasts production at 110.55 million tons.

Against the backdrop of favorable weather and strong demand from China, Australia will increase wheat acreage by 1.3% and barley by 3-15% in 2024/25, while canola acreage may decline.

Tags: Ukraine, prices, wheat