Poland and Ukraine both do not want to give in in the dispute over grain transports. In fact, oil is being added to the fire from both sides. Romania remains more under the radar, but there too, completely free access for grain from Ukraine - as Brussels would like - is not a foregone conclusion. However, Romania is taking a more constructive position towards Kiev.
The bickering between Poland and Ukraine over the grain trade is not over yet. Both countries do not want to move towards each other. Romania, which also sometimes wants to kick the bucket, has so far taken a much more constructive position. And the EU administrators in Brussels? They stand there and look at it.
The December contract for wheat on the Matif rose €1,25 yesterday to close at €238,50 per tonne. The grains also closed in the green at the CBoT. Wheat rose 0,8% to $5.88¾ per bushel. Corn rose slightly more strongly at 1,3%, closing at $4.82¼ per bushel. Soy lagged somewhat and rose 0,3% to $13.20 per bushel.
The cold between Poland and Ukraine is certainly not over yet. After Brussels lifted import restrictions, Poland, Hungary and Slovakia came up with their own measures to prevent a glut of cheap grain from Ukraine. Ukraine then went to the World Trade Organization (WTO), after which the Polish president made it clear that he was not impressed. Ukrainian President Volodymyr Zelensky yesterday added fuel to the fire during a UN meeting by speaking of 'political theater' surrounding grain exports that plays into Russia's hands. This irritates Poland, which summons the Ukrainian ambassador. Not much later, Polish Prime Minister Mateusz Morawiecki announced via Polsat News that Poland will stop supplying weapons to Ukraine. “We have stopped arms deliveries to Ukraine because we are now arming ourselves with the most modern equipment.”
Election theme
Now the soup is usually not eaten as hot as it is served, but the attentive reader may notice that Brussels hardly appears in the story. That is painful for the European Union, which likes to present itself as a bloc that stands behind Ukraine. If this harms the interests of individual member states, then there appears to be not much left of European solidarity. In practice, Brussels does not have many instruments to counter this. Of course, the fact that there will soon be elections in Poland also plays a role. The supporters of the ruling right-wing conservative party PiS are mainly in the countryside, which is partly why the grain trade is being made an issue in the election campaign.
By the way, it's not all doom and gloom. Romania and Ukraine are working together on a plan to manage grain transports. Romania is also among the five countries that were in favor of import restrictions. However, the country is now working on a licensing system to prevent cheap Ukrainian grain from remaining in Romania and driving local farmers out of the market. Due to its location on the Danube, Romania is perhaps the most important export route for Ukraine.
Tender
Egyptian state buyer Gasc yesterday secured 120.000 tons of wheat from Romania in a tender for $256 per ton FOB (delivered at port). Russian traders subscribed to the tender, but they were all at $280 per tonne FOB. The highest bidder was Ukraine, which offered 60.000 tons at $280 per ton.
Geopolitical tensions are not limited between the EU and Ukraine at the moment. The relationship between Canada and India has also deteriorated considerably. The reason is the murder of a Sikh separatist leader in Canada. Canada suspects India of being involved in this. After the expulsion of diplomats, some analysts are concerned about possible trade restrictions. Canada could hit India in particular with the export of potash.