Weather conditions in Ukraine and the Russian Federation that are not very favourable for winter wheat will reduce the harvest and export potential for both countries. Therefore, traders keep purchasing prices high at the beginning of the season, trying to assess the volume and quality of the new harvest.
Heat of 30-35 °C in Ukraine will improve the quality of wheat, but will reduce its yield.
The first data on wheat harvesting indicate that the yield is 0.5-1 t/ha lower than last year.
- Purchasing prices for wheat in Ukraine this week increased in the Black Sea ports by 2-3 $/t.
- Milling wheat prices reached the level of 192-195 $/t on CPT basis.
- Feed wheat – 175-177 $/t. While last year July prices were 150-160 $/t.
One of the reasons for the price increase is a decrease in the cost of freight from the Black Sea ports of Ukraine to a level corresponding to the price of freight from Romania and the Russian Federation. Also a decrease in the cost of insurance for the risks of entering the ports of Ukraine against the backdrop of active actions of the Ukrainian Armed Forces against the Russian Black Sea fleet, which has completely withdrawn from the Crimea.
In season 2023/24, Ukraine increased wheat exports compared to the previous season by 8.8% to 18.4 million tons. Although the USDA in June estimated it at 17.5 million tons. But in season 2024/25 it will reduce it to 14 -15 million tons due to a reduction in initial reserves and harvest to a 3-year minimum.