American and Black Sea wheat fell in price during the week, while European wheat rose in price

Last week, wheat markets traded under pressure from news from Ukraine and Russia and improved weather in the wheat-growing regions of the United States, Canada and Argentina.

Spring wheat growing areas in the USA and Canada received favorable rains for the formation of the crop, and in Argentina, precipitation improved the condition of crops, although the rains came late, so the sowing area decreased compared to forecasts.

Ships blocked there began to leave the Black Sea ports of Ukraine, and as of August 7, 8 ships have already been removed from the ports, and another 2 ships are planned to be removed on August 8. Last week, for the first time since the beginning of the war, one ship came in to load grain, which indicates the difficulty of finding ships ready to load in wartime conditions.

In July, compared to June, Ukraine increased grain exports by 21% to 1.7 million tons, which is 45% lower than in July 2021, when 3.1 million tons were exported. Thus, compared to June, corn exports decreased by 4% up to 1.2 million tons, which is 21% higher than in July 2021 and makes up 71% of the total July grain export. Wheat exports grew 2.6 times to 376.1 thousand tons (22% of July grain exports), which is 61% less than the July 2021 figure.

In Ukraine, 17.5 million tons of grain and leguminous crops were threshed from 4.8 million hectares with an average yield of 3.64 tons/ha, in particular, 12.6 million tons of wheat were harvested from 3.5 million hectares with a yield of 3.6 tons/ha .

Wheat quotations on world exchanges decreased on Friday:

• by 0.8% or $2.48/t to $285/t - September futures for soft winter SRW-wheat in Chicago (-4.2% for the week),
• by 1% or $4.4/t to $311.7/t - September HRW hard winter wheat futures in Kansas City (-3.1%).
• by 1% or $2.85/t to $325.7/t - September futures for HRS durum wheat in Minneapolis (-2.2%).

August Black Sea wheat futures in Chicago were flat at $353.5/t, but fell 0.8% for the week, while September wheat futures on Paris Euronext rose €0.25/t to 342, €5/t or $348.7/t, adding 1.9% to the price for the week.

The discrepancy in estimates of the wheat harvest in the Russian Federation keeps the market in tension. MSG believes that the expected 130 million tons of grain, in particular 87 million tons of wheat, will not be harvested due to long rains, which led to a delay in harvesting compared to last year by 7 million hectares, in particular wheat - by 3.3 million hectares. However, the increase in wheat yield compared to last year from 3.42 to 4.45 t/ha will allow to increase production.

Rusagrotrans experts increased the forecast of wheat production in the Russian Federation from 94.1 to 92.7 million tons due to the good yield of winter wheat. And if the current pace of harvesting is maintained, the wheat harvest may reach 96.6 million tons, while the USDA estimates it at 81.5 million tons, and in 2021/22 MR it amounted to 75.2 million tons.