International grain futures prices were largely flat over the past week, with MATIF December 2023 wheat contracts settling at either side of €277/t.

However, physical markets have weakened further, as buyers are either covered forward or they choose to wait before buying in a weakening market.

Black Sea exports continue to keep pressure on EU prices and their competitiveness is helping them pick up international tenders.

The strengthening of the euro against the US dollar is also acting to pressure eurozone prices.

Across the Atlantic, further reductions to the output forecast for the Argentinian wheat crop has provided some positivity for US markets, where recent export activity seems to have improved. Fears for the impact of the ongoing dryness in Argentina and the impact of delayed maize planting on yield prospects are also helping prices in the US.

Trading patterns

The last AHDB grain market report says that Russian wheat is back in the frame for export tenders, where its competitiveness is putting pressure on European wheat prices.

It reports that Algeria is believed to have purchased between 480,000t and 540,000t of milling wheat recently, with Bulgaria, Romania, Russia and France expected to be the origins.

This report also suggests that Syria imported just over 500,000t of wheat this year from the Black Sea port of Sevastopol on the Crimea peninsula, which was annexed by Russia in 2014.

This trade is proving controversial, as it is leaving on sanctioned Syrian ships and the port’s trade volume is said to have increased 17-fold this year, according to commentators.

It is also suggested by Ukraine that some of this grain has been stolen from occupied areas. These comments have the potential to spark further international incidents.

Ukrainian grain continues to be exported also, with November maize exports up on the previous month, but wheat was down.

However, the ongoing crisis there continues to leave this trade vulnerable to stoppages, as Ukrainian infrastructure is targeted by Russian attacks.

Native prices

This week sees further weakening of native grain prices, despite futures being relatively flat. Basically, the market has few or no buyers, so potential sellers are really engaged in pushing prices further down.

Nearby spot dry wheat is down around €305 to €310/t this week (occasional volatility), with barley around €285 to €290/t.

November 2023 dry prices are now back to around €285/t for wheat and €275/t for barley.