- Today has seen Egypt’s GASC secure a further 235,000 mt of wheat, this time for early Sep ’14 shipment, unsurprisingly from Black Sea origins. Russia picked up 120,000 mt, Romania 60,000 mt and (at last!) Ukraine 55,000 mt. Average prices appear to be as much as $5.00/mt below their last tender two weeks ago, although we are awaiting final data at the time of writing. Initial information suggests that France did not offer in this latest tender amid quality concerns caused by the wet conditions prevailing as harvest is under way.
- As a corollary to the above, we are seeing French millers paying big premiums to secure quality supplies in the face of the weather damaged harvest. At the same time exporters are scrambling to cover or hedge earlier sales in alternate origins as quality fears grow and concern increases that French wheat may fail to meet premium grade standards.
- In an interesting move, probably away from initial predictions, we see Ukraine and Black Sea corn offered at around $5.00/mt less than US Gulf offers in the new crop Oct/Nov ’14 positions. The impact is that much needed export demand is being pulled away from the US at exactly the same time as the U is staring at a potential record harvest. US lack of competitiveness is being created by soaring barge and trail costs, to get the crop to export terminals, and poses a potentially significant issue for the uS going forward – watch this space!
- As we approach the close in Chicago we see corn, wheat and the soybean complex all trading in positive territory. The oversold markets are working to adjust and we would not expect to see lasting gains. Weather forecasts in the US continue to suggest that crop prospects have little to fear at this time.