Stock market quotations for wheat fell by 3.3-5.9%, but in Ukraine prices are rising against the background of prolonged rains

Speculative price jumps continue on the global wheat market, caused by the shelling of Ukrainian ports, uncertainty with the export of grain through the Black Sea ports of Ukraine and the Russian Federation against the background of increased confrontation and threats to civilian ships.

If on Monday wheat futures rose by 7-8.6%, then on Wednesday they fell by 3.3-5.9% based on the data on the yield of wheat in the Northern Hemisphere, where harvesting continues.

Yesterday, September futures fell in price:

• by 5.9% to $264.6/t – for soft winter SRW wheat in Chicago,
• by 5.8% to $317.9/t – for hard winter HRW wheat in Kansas City,
• by 4.2% to $329.1/t – for hard spring HRS-wheat in Minneapolis,
• by 0.3% to $241.5/t – for Black Sea wheat in Chicago,
• by 3.3% to €253.25/t or $281.4/t – for wheat on the Paris Euronext.

The North Dakota crop tour showed a better-than-expected spring wheat yield of 3.23 t/ha (3.28 t/ha last year), adding to pressure on prices.

A USDA representative in India estimates the wheat harvest at 108 million tons, which is higher than the official forecast, but inferior to the USDA’s July forecast of 113.5 million tons, so the USDA’s August balance sheet may be adjusted.

The representative in Canada estimates the wheat harvest at 35.8 million tons (33.8 million tons last year), while the official estimate and the USDA’s July forecast are 35 million tons.

Rains will fall throughout Ukraine this week, which will delay wheat harvesting, and in some regions will worsen the quality of grain, which has already led to an increase in food wheat prices. Prices are supported by the limited supply of the new crop, as rains delay harvesting and farmers are in no rush to sell. According to preliminary data, the quality of wheat of the new harvest will be close to fodder wheat. In the central regions, the share of grain infected with soot has increased, which also affects the increase in prices.

Prices for wheat and corn delivered to the EU rose by $5-10/t, so exporters raised prices for deliveries to the Danube ports to $175-180/t or UAH 7,000-7,200/t, and for deliveries to the Baltic states or Constanta – up to $220-240/ton. Demand prices for wheat of the 2nd and 3rd classes from processors have increased to 5800-6500 UAH/t, and it seems that the price minimum of the current season has already been passed.

In the Russian Federation, due to heavy rains, wheat was harvested on only 14% of the area (22% in this period last year), but the authorities do not provide accurate data in order to continue manipulating the market.

Tags: EU, prices, Canada, wheat, India, USA, Ukraine