Increasing forecasts of wheat harvest and exports from Canada lowers quotations in the US

Wheat quotations on the world markets remain under pressure from the large supply and low demand from importers. In its December report, the Agriculture and Agri-Food Canada raised the forecast of wheat production in the country in 2023/24 MY by 2.2 mln tonnes to 32 mln tonnes (34.3 mln tonnes in the previous season), and the export forecast by 1.9 mln tonnes to 23.2 (25.7) mln tonnes.

This news had a negative impact on the U.S. wheat market, which exports as of December 12, according to USDA, amounted to only 8.926 million tons, which is 28% less than the 11.44 million tons shipped on this date last year.

March futures yesterday fell:

• 2% to 226.7 $/t – for soft winter SRW wheat in Chicago,
• 2.4% to 230,7 $/t – for hard winter HRW wheat in Kansas City,
• by 1.3% to 265.1 $/t – for hard spring HRS wheat in Minneapolis.

At the same time on the Paris Euronext wheat futures yesterday rose 0.5% to 224 €/t or 250,7 $/t.

The State Agency of Saudi Arabia for the purchase of food GFSA (formerly SAGO) purchased at tender 1,353 million tons of mainly Russian wheat with protein 12.5% and delivery in February – may at an average price of 284,57 $/t C&F.

Egypt’s GASC this week will hold an international tender for the purchase of wheat for delivery in February, which will be an indicator of prices in the short term.

China, according to the state customs, this year reduced wheat imports compared to the same period in 2022 by 29.4% to 11.5 million tons (with the USDA forecast of 12.5 million tons), of which 660 thousand tons were delivered in November (1.01 million tons in November 2022).

Ukraine is increasing exports, and shipped 593 thsd tonnes of wheat in 15 days of December, which is 10% down from the same period last year. In total, the country exported 6.5 mln tons of wheat in the season, which is 14% lower than last year.

The Purchase price of wheat continues to grow, but traders are interested mainly in feed wheat, the price of which reached 155-156 $/t or 6200-6300 UAH/t with delivery to the ports of the Black sea.

Tags: prices, Canada, wheat, USA