European wheat won the tender in Egypt thanks to a significant reduction in prices
On August 22, the Egyptian state operator GASC held a new tender for the purchase of wheat, for which significantly more offers were submitted, and prices for European wheat turned out to be lower than for Russian wheat.
Compared to the August 8 tender, the number of bids rose from 18 to 32, especially Bulgarian and French wheat, while offer prices fell from $262-305/t FOB to $265-270/t FOB.
The following applications were submitted to the tender:
- from the Russian Federation – 15 (14 at previous auctions) lots at a price of $270/t FOB (262-275 $/t two weeks ago and $250/t three weeks ago) and 1 lot at a price of $280/t FOB (295 and $305/t),
- from Romania – 5 (2) lots at a price of $265-272 (269 and 275)/t FOB and one of the cheapest at $256/t FOB,
- from Ukraine – 2 (2) lots at a price of $269.8 (278.4 and 284.1) $/t FOB,
- from Bulgaria – 4 (0) batches at a price of $263.7-271/t FOB,
- from France - 6 (0) lots at a price of $266.82-272.82/t FOB.
It is worth noting the increase in offers and low prices for Bulgarian and French wheat, which did not participate at all in the previous tender, as well as the fact that Russian wheat was offered exclusively at $270/t FOB, while European grain prices were significantly lower.
As a result, GASC purchased only one batch (60 thousand t) of the cheapest Romanian wheat from Agro Chirnogi with delivery on October 5-20 and immediate payment at a price of $256/t FOB + $14.25/t freight = $270.25/t C&F, which is 3% inferior to the purchase price of Russian wheat at the August 8 tender, which was 278.5 C&F ($262/t FOB + $15.74/t freight) with payment within 180 days.
In the new season, GASC purchased 655,000 tons of wheat, 81.7% of which was Russian, so European exporters increased their offers to compete with the Russian Federation in the market of the largest wheat importer.
