Wheat prices on the US exchanges started the week with a fall of 1.6-2.6% on the background of improving weather

Wheat futures on the US stock exchanges yesterday fell by 1.6-2.6% to a 2-year low based on data on the improvement of the condition of winter crops and forecasts of precipitation in the Plains region, which will contribute to a good harvest. In Europe, yesterday was a day off, and today prices are likely to rise on the news of restrictions on the export of wheat from Ukraine to the EU.

According to NASS USDA, 12% of spring wheat acreage was planted in the US as of April 30, which is 6% lower than last year and 10% lower than the 5-year average. The number of winter wheat crops in good or excellent condition rose 2% for the week to 28% (27% last year), but Kansas, Oklahoma and Texas remain in poor, very poor and fair condition at 87%, 91% and 83% of crops, respectively. .

For April 21-27, the USA exported 358.3 thousand tons of wheat, which almost corresponds to the level of the previous week.

The markets are waiting for the results of the tender, where the Egyptian GASC will buy wheat for delivery in June - July, the winner of which is likely to be Russian grain.

According to the Egyptian trade and transport company LATT, in 2023, 3.48 million tons of wheat were delivered to the country's ports, of which 91% or 3.16 million tons came from Russia, 209.3 thousand tons came from Ukraine, 59.5 thousand tons t - from the USA, 51.6 thousand t - from Australia. From April 1 to 25, 684,400 tons of wheat were delivered to Egyptian ports, of which 611,800 tons came from the Russian Federation, 51,600 tons from Australia and 21,000 tons from Ukraine.

Yesterday, July wheat futures fell:

• by 2.5% to $223.5/t - for soft winter SRW wheat in Chicago (-14% for the month),
• by 2.6% to $278.2/t - for HRW hard winter wheat in Kansas City (-13.4%).
• by 1.6% to $290.6/t - for hard spring HRS-wheat in Minneapolis (-12.6%).

In Ukraine, traders have stopped buying wheat for export because they do not expect the grain corridor to continue working after May 16. Even now, ships enter the Black Sea ports with a long delay. Processors have reduced prices to UAH 6,500-6,800/ton with delivery to the mill.

As of May 1, Ukraine exported 14.4 million tons of wheat, which corresponds to the USDA forecast for 2022/23. During May and June, it will be possible to ship another 1 million tons of wheat through the Danube ports.

Currently, the weather in Ukraine favors the development of winter crops, so the harvest forecasts are quite optimistic. However, farmers are worried about the blocking of exports from Ukraine to the EU and through Black Sea ports, especially given the decline in world prices.