The increased supply of new crop beginning to impact on wheat prices
Dry weather increases the rate of harvest of new crop and compensate for the delay which was observed in the beginning of the season.
Market is saturated with offerings that allow investors to overpay for the fast delivery to the port for implementation of the July deliveries.
According to the latest yield of winter wheat in the United States and Ukraine is at the average level in the EU and Russia are higher compared to last year.
Another factor in the pressure is reduced the rate of export, because of the unwillingness of importers to pay these high prices for wheat.
Traders have lowered the bar of expectations of the weekly export sales of US wheat of about 18% to 250-450 thousand tons. and due to the sharp appreciation of the Euro on the attractiveness of European grain also falls.
Prices in Chicago and Paris slowly declining for 7 consecutive days.
September quotes of the American wheat have decreased:
- soft wheat SRW in Chicago by $ 0.28 to 184,82 $ / ton;
- hard wheat HRW in Kansas city for $ 0,92 to 183.81 $ / ton;
- hard spring wheat HRS in Minneapolis by $ 1,84 to 284,94 $ / ton;
September quotes milling wheat on the Paris stock exchange MATIF fell by € 1.00 to 171,25 € / ton (197,21 $ / tonne).
Agency of Canada Agriculture and AgriFood Canada (AAFC) has increased the forecast of exports in the new season by 1 million tons to 16.6 million tons, through a substantial initial stocks of the season and reducing domestic consumption of wheat. However, due to the hot weather forecast of wheat production in Canada (excluding durum) in season 2017/18 has been reduced by 1.3 million tonnes compared with the June forecast.