Wheat prices rose by 1.3-3.4% against the backdrop of a decline in the EU harvest forecast and the suspension of the grain agreement

The wheat market remains under pressure from uncertainty over the further work of the grain deal, but prices rose sharply at the end of the week amid a cut in the forecast for EU wheat production to last year's level.

On Sunday, the last ship with grain left the Black Sea port as part of the grain agreement. The chances of an extension of the agreement are minimal, although Erdogan said that he agreed with Putin on its extension, which was later denied by the Russian side.

The Deputy Minister of Infrastructure of Ukraine Yu. Vaskov said that the country's authorities will not agree to the extension of the grain agreement on current terms and only for 120 days, as it is ineffective for farmers and exporters. If the agreement is not extended for 240 days, then Ukraine will move to alternative scenarios. One of them is the continuation of work with Turkey and the UN without the participation of the Russian Federation.

According to the SCC, 11 grain ships were inspected in July, and the average number of inspections was 1.3 ships/day, while in September-October 2022 it reached 10-11 ships/day.

The French agency Strategie Grains reduced the forecast of the soft wheat harvest in the EU in 2023/24 MR by 2.5 million tons to 126.2 million tons, which is 11.8 million tons less than the July USDA forecast and will exceed the 2022 figure by only 1% /23 MR.

Precipitation is delaying the harvest of winter wheat in the U.S., and yield data varies widely by region and June rainfall.

During the week, export sales of wheat from the USA decreased by 2.5% to 395.7 thousand tons, and in general in the season they reached 5 million tons, which corresponds to last year's pace.

September futures rose on Friday and offset the decline caused by the July USDA report:

• by 3.4% to $243.1/t - for soft winter SRW wheat in Chicago,
• by 2.8% to $304.6/t - for hard winter HRW wheat in Kansas City,
• by 2.6% to $324.9/t - for hard spring HRS-wheat in Minneapolis,
• by 0.1% to $233.5/t - for Black Sea wheat in Chicago,
• by 1.3% to €233.25/t or $260.2/t - for wheat on the Paris Euronext.

In Ukraine, as of July 14, 714.6 thousand tons of winter wheat were harvested from 211.8 thousand hectares with a yield of 3.37 tons/ha, while last year on this date, 1.7 million tons of wheat were threshed from 588.3 thousand hectares. with a yield of 2.88 t/ha (4.11 t/ha in 2021).

In the eastern regions of the Russian Federation, harvesting of spring wheat began 2-3 weeks ahead of schedule due to dry weather during the ripening period.