Rains in Ukraine and Russia weaken speculative support for wheat prices

This week, powerful atmospheric fronts brought long-awaited precipitation to the territory of Ukraine, which is gradually advancing to the arid southwestern regions of the Russian Federation - the main area for growing winter wheat.

 

According to weather forecasters, rainy and cool weather will last for another 7-8 days, which will contribute to the improvement of the condition of winter wheat crops. In this regard, analysts have already begun to revise pessimistic harvest forecasts in Ukraine and the Russian Federation upwards.

 

In March-April, high prices for Black Sea wheat were supported by dry conditions in the region, despite lower quotations in the US and EU. However, improved weather conditions in Ukraine and the Russian Federation triggered a sharp drop in prices.

 

Decrease in export prices:

• Food wheat :
  decreased by $2–4/t — to $228–234/t (or UAH 10,900–11,100/t )
• Feed wheat :
  a drop of $4–6/t — to $218–222/t (or UAH 10,300–10,500/t )

Some traders have suspended purchases of feed wheat due to the lack of export demand for its high price.

 

Export situation:

Only 136 thousand tons of wheat were exported in the first 7 days of May

Since the beginning of the 2024/25 MY, Ukraine has shipped 14 million tons, which is 17% less than last year (16.386 million tons)

Approximately 2 million tons of exports are expected by the end of the season.

 

Forward prices for the new crop:

• Food wheat : $215–219/t
• Feed wheat : $205–207/t
  (prices with delivery to ports)

Against this background, traders are gradually lowering prices to the level of the new harvest .