Increased exports from the US supported wheat prices, but the downward trend persists

Despite increased demand from importers, world wheat prices continue to fall under the pressure of low export rates from the EU and the USA. Chicago soft wheat futures fell 2.6% and Kansas durum wheat futures fell 4.2% after the December USDA report. Heavy rains have improved the condition of winter crops in the US, even in the arid Southwest.

However, yesterday the quotations were supported by data on the increase in export sales of wheat from the USA, which for December 1-7 reached a record this season of 1.49 million tons, and in total since the beginning of the season amounted to 14.53 million tons and exceeded last year’s pace by 3%, although still inferior to them.

Against the background of increased sales, March futures rose yesterday:

• by 1.7% to $226.2/t – for soft winter SRW wheat in Chicago,
• by 0.7% to $233.9/t – for hard winter HRW wheat in Kansas City,
• by 0.5% to $263.5/t – for hard spring HRS-wheat in Minneapolis.

At the same time, on the Paris Euronext, wheat futures yesterday fell by 2% to €223/t or $251/t, not reacting to the results of the tender in Algeria, where the state agency OAIS purchased almost 930 thousand tons of wheat from the Black Sea region and the EU (in particular and France) at a price of $272/t C&F.

In addition, Saudi Arabia announced a tender for the purchase of 715 thousand tons of flour wheat, Japan for the purchase of 102.5 thousand tons of wheat from Canada and the USA, Pakistan for the purchase of 110 thousand tons of wheat, and Jordan for the purchase of 120 thousand tons of wheat.

Against the background of favorable weather in recent months, the Rosario exchange RGE raised its forecast for wheat production in Argentina in MY 2023/24 by 1 million tons to 14.5 million tons, while the USDA estimates it at 15 million tons.

Tags: wheat, USA, prices