Wheat quotations on world exchanges rose by 2-2.6% after updating multi-year lows

Traders actively bought wheat futures yesterday due to data on the decline of the wheat harvest in the EU, as a result of which the quotations rose by 2-2.6%, partially recovering from last week's fall.

 

On Monday, the MARS agency lowered its forecasts for the average yield of common wheat in the EU from 5.87 to 5.68 t/ha compared to July estimates, which will be 2% less than the 2023 figure.

 

Yesterday, September wheat futures fell:

• by 2% to $186.8/t – for soft winter SRW wheat in Chicago,
• by 2.6% to $198/t - for hard winter HRW wheat in Kansas City,
• by 0.9% to $200.7/t - for hard spring HRS wheat in Minneapolis,
• by 2.2% to €193.75/t or $216.3/t - for wheat on the Paris Euronext.

 

Low rates of wheat exports from the EU, which, according to the European Commission, amounted to 3.93 million tons in the 2024/25 financial year (as of August 23), which is 22% less than the corresponding figure last year, are putting pressure on prices.

 

The Association of Cooperatives DRV reduced the wheat harvest forecast in Germany by 1.4 million tons to 18.8 million tons (21.5 million tons in 2023).

 

An updated official forecast for the wheat harvest in Canada will be released today, where, according to a Bloomberg survey, the production estimate may be lowered to 33.8 million tons (32 million tons last year), although the USDA estimated it at 35 million tons in August.

 

According to Rusagrotrans, export prices for September deliveries of Russian wheat with a protein content of 12.5% fell for the week by $3.5/t to $216/t FOB, for French - by $6/t to $224/t, German - by 10 $/t to 233 $/t, and for American - by 6 $/t to 213 $/t.

 

The decrease in prices is caused by a decrease in demand from importing countries and rumors about a possible extension of wheat imports to Turkey until the end of the year.

 

Experts have increased the forecast of wheat exports from the Russian Federation in August from 4.5 to 4.9-5 million tons (5.4 million tons last year), and in general, in two months it may reach 8.8 million tons compared to a record 9.6 million tons for the corresponding period of 2023.

 

As of August 26, 66 million tons of wheat were collected from 64% of the area (29.8 million hectares) in the Russian Federation, so the total collection may reach or exceed the forecasted 84-86 million tons, since the yield of spring wheat in Siberia is very high. Already in October, this will become an additional factor of pressure on world prices.