Russian wheat has become the cheapest in the world: Ukrainian exports are under pressure
3 July 17:43
Wheat purchase prices in Ukraine continue to decline amid active harvesting of the new crop, increased grain supply, and intensifying competition on the global market. Additional pressure on the market is coming from the falling prices of Black Sea wheat, which currently remains the most affordable option for international buyers. This is reported by GrainTrade analysts, according to "Komersant Ukrainian".
Purchase prices continue to fall
According to market data, export purchase prices at Ukrainian Black Sea ports fell by another 200–250 UAH per metric ton this week.
Currently, food-grade wheat is being purchased at 10,400–10,600 UAH per metric ton, or $206–$210 per metric ton, while feed wheat has dropped to 9,800–9,900 UAH per metric ton (194–198 dollars per metric ton) delivered to ports.
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Experts attribute the price decline to several factors. First and foremost is the acceleration of the harvest, particularly in the southern regions, where farmers are achieving higher-than-expected yields and are actively selling their grain.
The heat has accelerated the harvest, but rains could worsen grain quality
The abnormally hot weather of recent days has effectively ended the growing season and allowed harvest rates to accelerate significantly across the country.
However, forecasters predict prolonged rainfall in the coming days, which could slow down the harvest and negatively affect grain quality.
Analysts do not rule out that this season, as was the case last year, the proportion of feed wheat will increase due to fungal diseases affecting the grain. In that case, the price difference between food-grade and feed-grade grain may widen.
Black Sea wheat has become the cheapest in the world
New-crop Ukrainian food-grade wheat with a protein content of 11.5–12.5% is currently being offered for export at $227–231 per metric ton FOB.
At the same time, Russian exporters continue to aggressively cut prices, further intensifying competition in the Black Sea market.
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According to GrainTrade’s assessment, Russian wheat is currently the cheapest on the global market, which is sustaining high demand for Black Sea wheat, especially as U.S. wheat prices rise.
According to Russian analysts, export prices for new-crop food wheat have fallen by another $5–7 per metric ton over the past week—to $226–228 FOB.
This was caused by a sharp increase in grain supply from the southern regions of Russia, where a significant increase in the winter wheat harvest is forecast.
Global Market
At the same time, the situation on the exchanges remains mixed.
September futures for soft winter wheat in Chicago are trading at around $212.5 per metric ton, and on the European Euronext exchange—at around 202 euros per metric ton (nearly $230).
Global prices may be supported by unfavorable weather conditions in the U.S., where heavy rainfall is delaying the harvest, as well as an expected decline in production.
In addition, market participants are closely monitoring the results of an international tender announced by Saudi Arabia to purchase 655,000 metric tons of wheat for delivery in August–September. Its results could become one of the key factors shaping prices on the global grain market in the coming weeks.
