World wheat prices have decreased somewhat, but they continue to rise in Ukraine

High prices for European wheat increase export demand for Ukrainian wheat, which rose in price by 25-30% during May.

During the week, the purchase prices for wheat in Ukraine increased by another 5-10 $/t and thanks to the growth of the dollar against the hryvnia, they reached 9700-10000 UAH/t or 215-220 $/t for food wheat and 8900-9200 UAH/t or 195 -$200/t for fodder with delivery to Black Sea ports.

Recent rains have improved the condition of crops in Ukraine, but overall rainfall in May was well below normal, reducing the potential for future harvests. In the south-west of the Russian Federation, minor rains also fell, but the predicted heat of 30-35 ^o C in the coming weeks will worsen the prospects for the harvest.

In 2023/24, Ukraine exported 17.44 million tons of wheat, which is 12% higher than last year's pace and reduces stocks on the eve of the new season.

Accelerating harvesting in the US and improving crop prospects in Australia are putting pressure on global quotes. Australia's ABARES raised its forecast for the country's wheat harvest by 0.7 to 29.1 million tons, which would match the USDA's May forecast (29 million tons) and exceed last year's figure by 12%, and the 10-year average by 10%. Bureau experts believe that abundant rains in the east of the country created ideal conditions for crops, but in other regions, farmers were forced to reduce wheat sowing areas due to a lack of rainfall.

According to Rabobank estimates, the area under wheat in Australia in 2024/25 MR will reach 961 thousand hectares, so the harvest will increase compared to the previous season by 5.7% to 27.4 million tons.

In the USA, the new 2024/25 MR season started on June 1. According to NASS USDA data, as of June 2, winter wheat has been harvested on 6% of the area (3% 5-year average), and spring wheat has been planted on 94% of the planned area (90% 5-year average). 74% of spring wheat crops are in good or excellent condition (64% last year).

July wheat futures fell yesterday:

• by 0.9% to $247.2/t - for soft winter SRW wheat in Chicago (+3.5% for the month),
• by 1.3% to $257.2/t - for hard winter HRW wheat in Kansas City (+3.7%).
• by 0.8% to $269.6/t - for hard spring HRS-wheat in Minneapolis (+1.2%),
• by 0.2% to €258.75/t or $282.3/t – September wheat futures on the Paris Euronext (+17%).