Wheat prices are falling due to low export demand

Wheat prices on world exchanges fell 2-4% yesterday following falling oil, soybean and corn prices due to quarantine restrictions in China. In addition, demand for American and European wheat remains low, despite the blockade of exports from Ukraine due to Russian aggression.

Traders are adjusting their trading positions ahead of the release of the USDA report with sowing and stock forecasts in the US, which could have a significant impact on prices.

Fighting continues in the south, east and north of Ukraine, but farmers have begun sowing and traders have stepped up supplies of corn to the western border and Romanian ports.

Blocking exports from Ukrainian ports is beneficial to sellers of Russian and European wheat, who receive high prices. However, there is no increase in sales, as major importers have significant stocks and hope for a quick end to the war and lower prices.

According to SovEcon, Russia exported 2.2 million tons of wheat in March, compared to 2.5 million tons in February.

According to FranceAgriMer, 92% of France's crops are still in good or excellent condition, spring barley sowing is complete, and this week's rainfall will help grow crops.

• May futures for European wheat on Paris' Euronext fell 3.1% or € 11.5 / t to € 369.75 / t or $ 406.5 / t yesterday.

In Kansas, the state of winter wheat crops has improved somewhat, in addition, in the regions of its cultivation will be raining one of these days.

May futures in the US fell yesterday:

• 4.5% or $ 16.63 / t to $ 388.4 / t for soft winter SRW wheat in Chicago,
• 3.9% or $ 14.79 / t to $ 393.2 / t for winter winter HRW wheat in Kansas City,
• 2.3% or $ 9.09 / t to $ 396.6 / t for drought spring HRS wheat in Minneapolis,
• by 0.6% or $ 2.5 / t to $ 392.5 / t for Black Sea wheat in Chicago.

According to the US IAU, 341.2 thousand tons of wheat were exported on March 18-24, which is almost the same as last week and 11% higher than last year. In total, 16.89 million tons of wheat were exported during the season, which is 20.5% less than last year.

In Ukraine, purchase prices for food wheat remain at a low level of 7600-7800 UAH / t with delivery to the mill, as exports are almost non-existent, demand for flour is weak, and the volume of supply from farmers is quite high.