Global wheat bids continued to rise week over week.
Particularly, North American values are increasing at a faster pace than other origins, which likely will impact export demand.
Spring wheat is very tight to now and there no will be new harvest for this grade before 2022.
This is being reflected in the wide spreads between spring wheat and soft wheats.
On this wake, ADM cancelling 1,314 receipts last Thursday night, which propelled KC futures to fresh contract highs and MLPS wheat to break $10/bu.
Also on this morning, wheat futures continued to remain strong, with Mpls largely above $10/bu.
Additional strength in wheat came from the record pace of EU exports partially resulting from the Russian export tax, but not only.
Indeed, there was also talk of new sales of French wheat to China.
Wheat shipments by major exporters are up 9% compared to the USDA’s 2% increase.
Consequently, price still has a lot of work to do to lower demand.
Australian new crop wheat remains the cheapest wheat into Asia, Indian wheat apart.
However, it should to note that Australian futures are lower on the upcoming harvest, but higher for 2023.
Just for understand, the Jan. ‘22 – Jan. ‘23 have a difference of A$22/mt.
That equates to 45¢ per bu, compared to just 5-8¢/bu at the CBOT and KC for the same dates.
Argentine Fob wheat prices look cheap on paper.
However, real Fob values are hard to define.
Indeed, huge freight rates and the uncertainty over the GM situation make Argentine wheat only partially cheapest for now.
Additionally, weather forecast in Argentina remains dry and very warm temperatures will accelerate soil moisture losses.
On this wake, the Buenos Aires Exchange, dropped the wheat ratings Gd/ Exc. by 2% to 44%.
In add, exporters own 8.1 million mt of wheat against 9.1 million mt of export licences.
Thus wheat remains the bull leader globally.
