World Grain - February 2024 - 14

GRAINMARKET REVIEW
Monthly wheat prices
(in US dollars per tonne)
WHEAT
Cold weather in US, Europe
buoys bullish market
by Chris Lyddon
A weak tone in world wheat markets persisted into 2024,
although there were some bullish reactions to cold weather
across the Northern Hemisphere in the closing weeks of January.
US
Wheat Associates (USW) in its Jan. 19 Weekly Price
Report noted that wheat was lower as a lack of supportive
news has allowed bearish trends to continue.
Even so, recent large sales of SRW (Soft Red Winter) continue
to provide some support, " USW said, also reporting that
" recent cold temperatures across the northern US have hampered
rail logistics and demand for Hard Red Spring (HRS)
wheat from the Pacific Northwest (PNW) and HRS demand
from the PNW, " also provided a bullish influence.
USW added that " a recent cold snap in France and Germany
likely caused limited damage to waterlogged wheat in fields,
with heavy showers that further delayed sowings ahead of this
year's harvest, " citing a German statistics agency forecast of a
7% fall in winter wheat planted area for 2024 harvest, " notably
to poor field conditions. "
The United States also was hit by cold weather, affecting
major wheat-growing areas.
" Cold temperatures in the Northern Plains coupled with the
snow cover kept conditions constant, while further south in
the central US the lack of snow left the topsoil exposed to the
harsh conditions, drying it out, " USW said.
In its Jan. 11 Grain Market Report, the International Grains
Council (IGC) noted a net 1% decline since the mid-November
report, but with " mixed changes across underlying origins. "
" Amid
ample nearby availabilities and weakness in row
crops, values dropped to a fresh two-and-a-half-year low
in late-November, but rebounded sharply thereafter, led by
gains in the US, where exporter sentiment was spurred by an
upsurge in Chinese demand for SRW wheat, " the IGC said.
" However, there were divergent trends across US wheat classes,
as steady to firmer winter wheat quotations contrasted with
net declines for spring wheat, amid talk of competition from
Canada, where offers have also eased in recent weeks. "
With
continued worries about export
14
French fob values mostly softened since November, albeit
100
150
200
250
300
350
50
Jun 23 Jul 23 Aug 23 Sep 23 Oct 23 Nov 23
Wheat (US), No. 2 hard red winter Gulf export price; June
2020 backwards, No. 1, hard red winter, ordinary protein,
export price delivered at the US Gulf port for prompt or 30
days shipment.
lower prices prompted fresh overseas buying interest, with
declines also capped by weather-related concerns about local
2024-25 production prospects, the IGC added.
Turning to Russia, the London-based international organization
said quotations there firmed moderately, supported by
currency movements, occasionally reluctant grower selling
and seasonally difficult shipping conditions.
" Fob prices at Ukraine's deep-sea ports were thinly quoted,
albeit as the seaborne corridor became the main route for exports,
pressuring freight costs for land and river deliveries, "
the IGC added.
The USDA's Foreign Agricultural Service (FAS) in its Jan.
12 Grain: World Markets and Trade report noted a decline in
US prices since the December World Agricultural Supply and
Demand Estimates report, which was published on Dec. 8.
The move reflected " adequate global supplies, increased competition
as Southern Hemisphere crops come to market, and a
strong US dollar, " it said.
" Soft Red Winter dropped $14 to $259/tonne on slowing
demand from China, " the FAS said. " Hard Red Spring prices
declined $14 to $304/tonne, reflecting stronger competition
from Canadian spring wheat. "
The FAS also reported Hard Red Winter (HRW) down $9 to
$285/tonne, " reflecting recent precipitation in the HRW belt
and favorable growing conditions compared to last year. "
" Major exporter quotes are largely unchanged since the December
WASDE, " the FAS said. " EU and Russian quotes have
converged in tight competition. EU quotes eased by $5/tonne,
while quotes from Russia edged $5/tonne higher amid strong
overseas shipments. "
Chris Lyddon is World Grain's European correspondent.
He may be contacted at: cajlyddon@gmail.com
competitiveness,
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February 2024 / World Grain / World-Grain.com
Source: US Department of Agriculture; World Bank.
http://www.World-Grain.com
World Grain - February 2024

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