Wheat prices remain at a low level, but an increase in demand has been recorded in Ukraine

During the week, December wheat futures on world exchanges remained stable against the background of low demand and a significant volume of offers from the Russian Federation. The Egyptian GASC purchased 950,000 tons of wheat last week through direct negotiations and a tender, of which 780,000 tons were of Russian origin.

Yesterday, December futures fell:

• by 1.2% to $209.6/t – for soft winter SRW wheat in Chicago (+2.2% for the week),
• by 0.3% to $245/t – for hard winter HRW wheat in Kansas City (0%).
• by 0.1% to $267.4/t – for hard spring HRS-wheat in Minneapolis (+0.5%),
• by 0.5% to €236/t or $249.6/t – for wheat on the Paris Euronext (+0.6%).

According to the USDA report, wheat exports from the USA for the week of October 6-12 increased by 16% to 354.7 thousand tons, and in total for the season amounted to 6.75 million tons (compared to 94 million tons on this date last year) with projected USDA for 2023/24 MY 19 million tons.

EU countries in the 2023/24MY as of October 15 reduced wheat exports by 22% from 11.34 to 8.61 million tons compared to the previous season, although the USDA predicted an increase in exports from 35 to 37.5 million tons.

Export of grain from the Russian Federation in the new season reached 20 million tons, which is 40% ahead of last year’s figures, and in general, according to the IKAR forecast, it will amount to 64.7 million tons.

As of October 15, 68% of the planned area was planted with winter wheat in the USA, which corresponds to the 5-year average level, and good precipitation is helping the development of crops.

In Ukraine, as of October 16, due to the dry weather in September, only 69.3% of the planned areas or 3 million hectares were sown with winter wheat. This week’s rains will speed up planting, but plants will need warmth to prepare for winter.

As of October 13, Ukraine exported 3.84 million tons of wheat, which corresponds to last year’s pace, although the USDA forecasts a decrease in exports in 2023/24 from 17 to 11 million tons.

Activation of shipments through Black Sea ports increases export demand for grain. As a result, purchase prices in Odesa ports rose to $125-130/t for fodder wheat and $145-150/t for food wheat, although this level of prices was observed in Danube ports a week ago.

Tags: prices, wheat, Ukraine, Russia, EU