Wheat prices drop under pressure of decreasing demand

the price of wheat on world markets fall amid the absence of factors supporting, low activity and favourable precipitation in areas growing winter wheat in the major exporting countries.

Caused by China's purchase of large consignments of corn from the US and hopes for the intensification of procurement of wheat speculative price increases, which began on Monday, yesterday the stopped, data on export sales of US wheat, which were lower than expected, and such pressures as export restrictions in Russia and the intention to impose the same restrictions by the authorities of Argentina.

Export sales of wheat over the week grew by 15% to 380,5 thousand tons (in December, 250-600 kt), and overall, the season was 21,77 million tons, which is 4% higher than last year's pace (a week ago it was 5.4%).

the Actual export of wheat from the U.S. last week rose by 91% to 505,7 thousand tons, and just season reached 15.5 mln t from the predicted USDA26,8 million tons; Therefore, until June 1 it is necessary to ship 11.3 million tons, or 630 thousand tons weekly.

Purchase of Japan at the tender 60 thousand MT of Australian wheat for delivery in April testifies to strengthening of competition in the traditional American wheat markets.

On all platforms, investors have been speculative sales and recorded a profit.

the March wheat futures in the U.S. fell:

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at 3,95 $/t to 230,01 $/t for solid winter HRW wheat in Kansas city

4, 87 $/ton to 227,62 $/t on a firm spring HRS wheat in Minneapolis.

• at 4.13 $/t to 237,73 $/t for SRW soft winter-wheat in Chicago

the Market for French wheat after a 3-day growth turned down Chicago. Traders are also upset that out of the acquired by Algeria in the last tender 630-660 thousand tons of wheat, the share of French grain amounted to only 270 thousand t, while in Argentina – as much as 210 thousand tons.

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• the March futures for milling wheat on MATIF fell 1.25 €/t to 229,75 €/t or 278,19 $/t

the European Commission downgraded its forecast for exports of soft wheat in EU 2020/21 MG from 24 to 26 million tonnes, primarily due to restrictions on the export of Russian grain, which will take effect from February.

a Decline in prices for supplies of Russian wheat in February to 290-295 $/t FOB puts pressure on the prices of Ukrainian wheat, which after falling in the port is 15-20 $/t recovered to 270-275 $/ton, up allows traders to hope to enhance sales by manufacturers in the near future.