European wheat markets traded steadily lower this week in the wake of last Wednesday's global price spike. Many of the supportive factors remain in play, but uncertainty over US-China trade talks and nervousness surrounding the Coronavirus outbreak were enough to spark a round of fund selling in agricultural commodities, including Chicago wheat and corn.
Data from Brussels put EU wheat exports 70% ahead of last year's pace and this looks set to continue, with French wheat currently the cheapest in the world. Despite this, Matif mirrored Chicago, trading €5 lower in the aftermath of last week's 17-month highs.
European wheat markets traded steadily lower this week in the wake of last Wednesday's global price spike. Many of the supportive factors remain in play, but uncertainty over US-China trade talks and nervousness surrounding the Coronavirus outbreak were enough to spark a round of fund selling in agricultural commodities, including Chicago wheat and corn.
Data from Brussels put EU wheat exports 70% ahead of last year's pace and this looks set to continue, with French wheat currently the cheapest in the world. Despite this, Matif mirrored Chicago, trading €5 lower in the aftermath of last week's 17-month highs.
UK old crop exports have slowed to a snail's pace and consistent domestic demand has pushed premiums to a level that will limit further port business in the short-term. With around 1 million tonnes surplus to export or roll to next year, the market is still considering all outcomes and weighing-up how these will impact next year's supply and demand.
In the meantime, we continue to see old crop Russian wheat trading at a premium to new crop due to strong demand and rumours of export taxes. July to December wheat exports were reported at 22.2 million tonnes which is around 3 million behind last year's pace but, nonetheless, we've seen port prices trading at their highest level since February 2019. The inverse into new crop reflects a huge planting effort and a favourable weather forecast which could result in an 80+ million tonne crop, adding weight to 2020 exportable supplies and growing world wheat stocks.
