Cheapest on tender in Egypt became French wheat

Yesterday's tender in Egypt, once again confirmed the overvaluation of Russian wheat on the world market.

Egyptian State operator GASC has held a regular tender for purchase of wheat on a background of falling world market quotes, when analysts predicted a further drop in prices. However, the Russian sellers continued the policy, which they conducted from October 2019, when they gradually raised the prices for wheat, causing GAS to pay more. Then, thanks to such actions, world wheat prices rose sharply, despite significant reserves and the level of proposals.

To participate in the tender was submitted 22 applications:

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3 Romanian price 234,79-239,49 $/t FOB,

3 Ukrainian price 235,5-242,25 $/t FOB,

13 Russian price 237,15-246 $/t FOB.

• 3 French wheat at a price of 231,5-237 $/t FOB,

the Russian wheat compared to the previous tender went up by 2-5 $/t, while the Romanian, Ukrainian and French fell, particularly the last one – by 4.36 $/t FOB, which made it the cheapest of offered.

In the end, GASC bought 180 KMT of French wheat for March 11-25 246,1 price $/t CFR, which consists of freight cost of $15/t and rates the amount of 231.1 $/t FOB, which is 5,17 $/t FOB, lower than at the previous auction on January 14. It was then purchased 240 thousand tons of Romanian and Russian wheat protein 12.5%, and delivery of 1-15 March at an average price of 236,27 $/t FOB or 249,5 $/t CFR, which is 4 $/t higher than the purchase price of the tender on 8 January, when it was contracted 300 thousand tons of Romanian, Ukrainian and Russian wheat at an average price of 232,23 $/t FOB or 245,71 $/t CFR.

the Decline in tender prices in Egypt was an additional signal of market black sea wheat that against the background of high world stocks, many sellers are willing to lower prices to boost exports.