Wheat prices have been declining since the beginning of the year under pressure from lower demand and forecasts of inventory growth

Wheat quotes on stock exchanges rose slightly on Friday, but in general, since the beginning of the new year, quotes have been declining under pressure from low demand, as well as forecasts of an increase in the harvest and global wheat stocks.

From December 31 to January 7, wheat contracts fell by 1.5% on the Chicago Stock Exchange (SWOT), and in Europe, January contracts fell by 2.7% on the LIFFE exchange in London to 2 289.2/ton, on the MATIF exchange in Paris by 1.2% to.309.9/ton.

FAO lowered its forecast for global wheat production in 2021/22 from 770.4 million tons to 769.6 million tons.tons against a record 776.5 million tons last season, mainly due to lower estimates for Brazil and the UK, but also lowered the forecast for wheat consumption from 778.8 to 777 million tons, due to a decrease in feed consumption in the EU, but will still be 2% more than in the previous season. The forecast for global reserves at the end of the 2021/22 season has been raised by 2.6 million tons to 284.7 million tons, but will still be 1.7% lower than last season.

 This week, the USDA will release its January report on wheat supply and demand, which is likely to raise the level of production and wheat stocks due to the correction of data for Australia and Russia.

The Russian government has introduced an annual quota for grain exports from February 15 to June 30, 2022 in the amount of 8 million tons of wheat and 3 million tons of barley, corn and rye.

The Tunisian state food procurement agency (ODC) contracted, as planned, 125 thousand tons of soft wheat, 75 thousand tons of durum wheat and 75 thousand tons of barley for delivery in January-March 2022.

At the same time, soft wheat purchase prices were much lower than at the previous tender on December 2: soft wheat was purchased at an average price of C 368/ton C&F (- дешевше 16.7/ton cheaper), and durum wheat was contracted at an average price of 6 698.68/ton, which is 1 17.80/ton more expensive than in December.

During the tender, Jordan purchased 60 thousand tons of wheat of any origin from Agro-Chirnogi at a price of C 326/ton C&F for delivery in the first half of August 2022, which shows that the prices of the new crop are still much lower than the existing ones at the moment.

Recall that in the first half of the 2021/22 season, wheat prices in the Black Sea region increased by 45% amid concerns about grain production and quality in the Northern Hemisphere, as well as the imposed duty on exports from Russia, despite the record harvest volume since 2017.

During the period July-December, export quotes for Russian wheat with protein 12.5%, and for Ukrainian wheat with protein 11.5% on the FOB basis increased by.100 per ton and reached 3 330-345/ton FOB.