Precipitation in the EU and the USA and the possible unblocking of Ukrainian ports increase the pressure on wheat prices

In the EU and the US, after a recent heat wave, temperatures will drop this week and there will be plenty of rain, which will reduce the risks to the late crop harvest, which has recently pushed up wheat prices.

Record heat prevails in Europe, but already on Wednesday it rained in France, and heavy showers and a drop in temperature are expected in Germany today. Dry and warm weather made it possible to accelerate the harvesting of barley and wheat, and the yield and quality of wheat in these countries is quite high.

The Egyptian GASC, after the cancellation of the tender for American wheat, yesterday purchased, according to traders, at private auctions 580-640 thousand tons of French, German, Lithuanian and Russian food wheat at a price of $403-405/t C&F, which is $10-15/t lower than at the July 4-5 tender, where GASC purchased 500,000 tons of French, German, Romanian, and Russian old-crop wheat at a price of $416/t C&F.

Pakistan bought 300,000 tonnes of food wheat at $404.85/t C&F and plans to buy another 200,000 tonnes next week.

Bangladesh purchased 50,000 tons of wheat at a price of $448.86/t C&F.

Against the background of technical purchases, wheat futures on world exchanges rose yesterday:

• by 0.9% or $2.66/t to $301.1/t - September futures for soft winter SRW wheat in Chicago,
• by 0.1% or $0.46/t to $319.9/t - September HRW hard winter wheat futures in Kansas City,
• by 0.9% or €3/t to €340/t or $347.4/t - September wheat futures on Paris Euronext.

At the same time, September futures for HRS durum wheat in Minneapolis fell by 0.5% or $1.93/t to $339.6/t, and August futures for Black Sea wheat in Chicago remained at 360.25 $/ton

During the first 10 days of the new season, the EU exported 363,944 thousand tons of wheat, which is 24% more than the same figure last year.

Today, the markets are waiting for the results of the negotiations on unblocking the ports of Ukraine and accurate data on the auctions in Egypt. However, one should not expect a sharp drop in prices from the decision to resume exports from Ukraine, since realistically supplies will not resume before September, and the daily shelling of Mykolaiv will not allow port terminals to work, especially those owned by foreign companies .