Wheat Futures Maintain Upsurge Amidst Positive Market Sentiment

GASC Purchase Boosts Market Confidence

The wheat futures market continues to rally as traders react positively to the latest purchase by the Egyptian Grain Procurement Authority (GASC) last Wednesday.A total of 110,000 kilograms of wheat was procured, with 50,000 kilograms comprising Bulgarian wheat at a fob level of $234.50 per ton with a freight rate of $16.75 per ton and the remaining 60,000 kilograms sourced from Romania at a fob level of $234.50 per ton with a freight rate of $20.78 per ton (payment within 270 days in both cases).

Increased Wheat Offerings and Market Dynamics

Despite Egypt’s purchase of only 110,000 tons in this tender, offers exceeded 2 million tons, highlighting the abundance of wheat and a strong desire for large-scale sales, according to Tofio Catön, Director of Grain Products at the Agricultural-Food Cooperatives.

Price Trends and Market Outlook

According to SovEcon estimates, prices for Russian wheat with a protein content of %12.5 have risen by $2 to reach $201-204 per ton FOB. Since the beginning of January, Russian wheat prices have experienced a decline of $44, with recent gains attributed to the recovery of competitiveness in the Russian wheat market and a resurgence in demand.

Anticipated Market Developments

As for corn, market sentiment remains bullish. Traders eagerly await upcoming data, including U.S. planting figures, weather conditions in Brazil, and China’s procurement activities from Ukraine.

Uncertainty Surrounding Trade Measures

The renewal of autonomous trade measures (ATM) with Ukraine remains uncertain. The EU has decided to extend customs duties on Ukrainian imports for another year until June 5, 2025, while deliberations continue on including corn as a sensitive product (excluding wheat) and determining reference years for setting customs duties without maximum import quotas. The Commission proposes 2022 and 2023 as reference years, but there is movement in the European Parliament and Council to change these dates to 2021-2022 or 2021-2022-2023.