Wheat quotations remain under the pressure of uncertainty with the operation of grain corridors

Wheat markets remain under the pressure of uncertainty with the further work of grain corridors, and rumors are spreading among traders about the ban on the entry of ships into the Black Sea ports of Ukraine since the beginning of November. It is worth noting that after the return of the Snake Island to Ukrainian control and the sinking of part of the Russian ships in the Black Sea, the Russians can no longer block the ports of Odesa, Chornomorsk and Yuzhnoye, unless they increase the shelling of Ukrainian ports or start pirate raids of foreign ships.

On October 16, representatives of the United Nations and the Russian Federation held negotiations in Moscow to extend the validity of the agreement, but the Russians did not confirm the agreement, and yesterday the representative of the Russian Federation at the United Nations said that everything will depend on the guarantees provided by the United Nations regarding the free export of Russian grain and fertilizers, since with this there are problems

Logically, Russia cannot abandon the agreement, since stopping grain and fertilizer exports will further worsen the state of the economy, which is suffering from a reduction in gas and oil exports, but the Kremlin surprises the world every time with the complete lack of logic in its actions.

During the week, stock exchange quotations for wheat fell to a monthly low, but they may soon be supported by the factors of Ukrainian exports and unfavorable weather for sowing winter crops in the USA and Ukraine, which will lead to a reduction in the area of sowing.

In the October report, IGC experts left the global wheat production forecast at 792 million tons, although for Argentina, the harvest estimate was reduced by 500 thousand tons, which will be compensated by the increase in production in Australia, the United States, and the Russian Federation. And the estimate of world final reserves in 2022/23 was increased by 200,000 tons to 285.8 million tons.

Against the backdrop of a prolonged drought, the Argentine exchange RGE lowered the forecast for the wheat harvest in the country in 2022/23 MR from 16 to 15 million tons, while last year it reached 23 million tons.

For the third week, export sales of wheat from the USA did not exceed 200,000 tons, and this time they amounted to only 163,000 tons, and in total in the season they reached 11.3 million tons, which is 8.5% lower than last year's pace.

Yesterday wheat quotes rose:

• by 0.9% or $2.94/t to $312/t - December futures for soft winter SRW wheat in Chicago,
• by 0.8% or $2.94/t to $349/t - December HRW hard winter wheat futures in Kansas City,
• by 0.9% or $3.3/t to $353.7/t - December futures for HRS durum wheat in Minneapolis,
• by 0.8% or €2.75/t to €338.75/t or $331/t - December wheat futures on Paris Euronext.

At the same time, November Black Sea wheat futures in Chicago fell by 0.5% or $0.25/t to $325.5/t.

Today, the state agency of Saudi Arabia SAGO is conducting a tender for the purchase of 523 thousand tons of wheat, and the Turkish agency TMO - for the purchase of 495 thousand tons of food wheat, the results of which will soon set new benchmarks for wheat prices.