Lower forecasts of global stocks, as well as quotas for wheat exports from Russia, gave a new boost to wheat prices

Wheat quotes on world stock exchanges accelerated growth again yesterday after declining the day before, receiving support from the release of the" bullish " November supply and demand report from the US Department of Agriculture, as well as on news about Russia's decision to return to grain export quotas from 2022 and the results of tenders for wheat purchases.

Lowering the forecast of global wheat stocks below market expectations in the November USDA report provided strong support for prices. USDA experts raised the forecast for wheat production in Russia by 2 million tons to 74.5 million tons, although analysts expected an increase to the level of 75-76 million tons. the export forecast was raised by 1 million tons to 36 million tons, although Russian analysts reduce export forecasts to about 34 million tons due to low export rates in the first half of the season and the introduction of export quotas in the second half of the season.

From July 1 to November 1, Russia exported 10.6 million tons of wheat, which is 32% less than a year ago. Analysts predict an increase in wheat exports in November and December amid the introduction of quotas.

The Ministry of Agriculture of Russia said that in the first half of 2022 it is planned to introduce a tariff quota for grain exports, which provides for a separate quota for wheat, and with a further increase in world wheat prices, it may revise the formula for calculating the "floating" export duty in the direction of increase.

 The size of the quota will be determined at the end of the year, taking into account the specified crop volume, as well as export rates in the first half of the current agricultural season.

After such a statement, December Black Sea wheat futures on the Chicago SWOT jumped by день 10/ton for the day to another record level of 3 352.5/ton.

Wheat prices on US stock exchanges also showed a strong increase of 2-3% yesterday under pressure from news about a decrease in the assessment of the state of winter crops and a deterioration in the global wheat balance.

According to the US Department of agriculture, as of November 7, the condition of winter wheat crops is estimated at 45% of those in good or excellent shape, but the share of crops in poor and very poor condition increased by 1% to 22% from 17% a year ago.

December US futures rose sharply yesterday:

• by 9 9.0 / ton to 2 295.1 / ton for soft winter SRW wheat in Chicago, (+10% for the month);
• by 8 8.82/ton to 3 300.4 / ton for winter durum wheat in Kansas City, (+11.5%);
• by 8 8.27 / ton to.384.4 / ton for durum Spring hrs wheat in Minneapolis (+11%).

December wheat futures on Paris ' Euronext also jumped 8.75 €/t yesterday to 294.75 €/t or 3 338.34/t, although they did not reach the record level reached last week by 295.75 €/t. the euro's depreciation to a new low of 1.1479 supports exports from the EU.

The Tunisian food agency (ODC) purchased 100 thousand tons of wheat at a tender for delivery from December 1 to January 5 at an average price of 3 384.52/ton of C&F and, according to traders, European wheat was purchased.

FranceAgrimer raised its estimate of soft wheat production in France in 2021 from 35.2 to 35.5 million tons, which is 21.5% higher than the 2020 harvest and 6.2% higher than the 5-year average harvest, and also lowered its forecast for wheat exports from France in 2021/22 MG to the EU from 8 to 7.8 million tons. t, and outside the EU with 9.6 million rubles. tons to 9.4 million tons, and also lowered the forecast for the use of soft wheat for feed in France from 5.2 to 4.8 million tons, which will increase the final wheat reserves in the country.