Global wheat demand has been more extreme than ever. This is also evident from this week's new export figures. Meanwhile, China's market share for corn is also very limited. In Australia, concerns about wheat yields are mounting. Less than 10 millimeters of rain fell in the southeast of the country in September. That's low, even by Australian standards. With a major harvest month still to go, local sources fear that yield expectations will have to be revised downwards.
The December wheat contract on the Matif closed yesterday up €0,25 at €188 per tonne. Wheat also showed a modest gain on the CBoT, rising 0.5 cents to $5.07¼ per bushel. Corn rose somewhat more strongly, rising 2¼ cents to $4.22 per bushel. The biggest gainer on the Chicago exchange during the last trading session was soybeans, up 7½ cents to $10.29½ per bushel.
Moderate demand for wheat on the global market remains a recurring theme. This week's export figures are no exception. EU wheat exports in the period up to and including October 5th are 25% behind last season. This season, the EU exported 4,96 million tons of wheat, compared to 6,63 million tons in the same period last season. Saudi Arabia, with 638.000 tons, is the largest customer for European wheat exporters. Morocco follows with an import of 472.000 tons. There is also a bright spot in the European export figures. At 2,18 million tons, barley exports are 42% ahead of last season. At the same time, maize imports were 30% lower than last season. In total, the EU has imported 3,93 million tons of maize so far.
Ukraine is also struggling to find customers for wheat. According to the latest figures, Ukraine has exported 4,98 million tons of wheat so far this season, compared to 6,8 million tons last season. In total, Ukraine has exported 6,9 million tons of grain, compared to 11,7 million tons last season. Besides wheat, 963.000 tons of corn and 868.000 tons of barley were also exported. By comparison, 2,8 million tons of corn had been exported at this time last season.
China is holding back
According to some analysts, a key factor in Ukraine's lackluster grain exports is the reduced demand from the EU. Shortly after the Russian invasion, Ukraine gained easier access to the internal European market, and those measures are now being gradually reduced. SovEcon reports the weakest start to the Ukrainian corn export season since 2020/21. SovEcon head Andrey Sizov points to China's absence. Although China has secured substantial volumes of barley in Ukraine, Beijing has barely tapped the corn market in recent months.
Incidentally, Russia was China's largest corn supplier in the first eight months of this calendar year. With 287.000 tons, Russia exported three times as much corn between January and August this year as in the same months last season, when exports totaled 96.000 tons, according to various media reports based on Chinese customs figures. Brazil, with 249.000 tons, is the second-largest corn supplier to China after Russia. Ukraine comes in third with 231.000 tons worth approximately $60 million.
Russia's wheat exports could rise to 5,1 million tons in October, according to Rusagrotrans. In September, Russia exported 4,6 million tons of wheat, but in October of last year, exports totaled 6,1 million tons. To boost exports, the Kremlin also lowered the export tax on wheat by 20%.
Drought Australia
Much further south in Australia, expectations for the grain harvest are somewhat tempered. The country down below It seemed poised for a very good wheat harvest. In September (a key month for wheat growth in Australia), the southeastern provinces of Victoria and South Australia received significantly less rain than usual. In South Australia, less than 10 millimeters fell in September, less than half the long-term average, according to the Australian Meteorological Institute. Approximately a quarter of Australia's wheat comes from these two southeastern provinces.
With warmer weather approaching, the wheat situation in Australia could deteriorate further, according to some local sources. Some weather models are predicting slightly higher rainfall chances for Australia by the end of the month. Whether this will benefit growers is another matter. The first fields are threshed in November, and rain shortly before or during harvest is detrimental to quality.