Russia has been able to considerably expand its wheat export, but it also has to work hard to match the United States (US). The market scene in Europe is calm. There is more excitement in Chicago.
The most recent WASDE report did little to shake up the grain market. The report increased the world's paper wheat supply by 4,5% to 267,5 million tonnes. That is good for a global consumption of 19 weeks. The increase in this theoretical stock puts more pressure on prices. This is particularly evident on the futures markets.
Rest in Europe
Over the past 14 days, the Matif in Paris has topped €161,75 per tonne on Tuesday, November 7. The price then only fell to a low of €20 per tonne on Monday 157,75 November. The next day the closing price ended slightly higher. In the period mentioned, 11,1 million tons of wheat were traded, good for 222.000 contracts.
There was more action to be had at the CBoT in Chicago. On November 7, the stock closed at $427,25 cents per bushel before rising to $431,50 cents per bushel. Nearly 9 contracts were traded on Thursday, November 150.000. The closing price has been $2 for the past 422 weeks, with a low of $420. In total, almost 900.000 contracts were traded, worth 122 million tons.
Russia to number 1
Analysts assume that Russia will emerge as the world's largest grain exporter this year. In the first 4 months of this season, which has been running since July 1, exports have shown an increase of almost 25%, good for 19,5 million tons. The vast majority, 13,7 million tons, is wheat. This type of grain makes a plus of 23%. Still, Russia needs to significantly increase its export volume to match the US.
American wheat exports are slightly negative. Up to and including week 45, approximately 2017 million tons of wheat have been exported for the 2018/16,3 season; 5% less than last season. At that time it was 17,2 million tons. Ukraine also exported less wheat up to and including week 45. This concerns a minus of 3,5%. The total volume amounts to 9 million tons.
Less EU exports
In the period between November 8 and 14, the EU exported 685.649 tons of grain, of which more than half a million tons of soft wheat. The rest comes from barley. During the same period, 200.000 tons of grain were imported, consisting of 23.522 tons of wheat and 101.403 tons of corn. Based on customs data, this makes the EU a net exporter of 3,8. That was 9,4 million tons last season.
Brazil is the largest supplier of corn to the EU. It has 60% of the volume. The rest mainly comes from Ukraine. Spain is the largest buyer of this imported corn. The Netherlands is at 2 and Poland at 3. Barley exports are largely controlled by France with 36% of total exports, followed by Romania (31,4%) and Germany (22,7%).