Russian wheat prices in deep-sea ports dropped $9 to $274/mt (12.5%, FOB) on lack of demand and weaker global benchmarks.
May wheat in Chicago and Paris lost 1.6-1.7% last week.
Seems that many buyers hope to see lower prices in 2020/21 or postpone their purchases until the new season.
The global wheat market is watching the weather in the Northern Hemisphere which remains friendly for the new crop. The Black Sea weather improves. Last week was a bit dry, but parts of Russia’s South received around 5-10 mm. More importantly, the temperatures were above the norm by 1-2C during the week which helped to melt the remaining ice-crust on fields.
Temperatures are predicted to be close to average this week with good precipitation (10-25 mm) in the South, the southern Black Earth and the Lower Volga Valley. It’s a good setup for plants that started to break dormancy recently.
SovEcon upped Russian wheat crop estimate by 3.1 MMT to 79.3 MMT, Ukrainian crop was revised higher by 0.8 MMT to 27.8 MMT.
The EU had received some rains and crops are in good shape, the US received above-norm precipitation offsetting moisture deficit in key wheat regions.
It’s hard to find bullish news in the wheat market at the moment, however, the corn market could help it if it moves substantially higher which looks like a possible scenario.
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