Wheat prices are rising faster in the US than in Europe

Strong demand from China has given the US wheat market a significant boost over the past two weeks. In Europe, wheat prices are very stable.

Wheat for March 2024 delivery on the CBOT in Chicago was trading at around $236 a tonne this weekend. That means US wheat prices will rise by about 20 percent from the last week of November. The current price level is the highest since early August.

The US wheat market is mainly benefiting from high export demand from China. In Weekly Report Cereals The Netherlands Enterprise Agency reported this week that the U.S. has entered into export commitments for 12.7 million tons of wheat so far in the 2023-2024 season. This is 6 percent less than last year.

Canada’s export figures are also still disappointing compared to last year. However, Canadian traders report that export volumes have increased by 25 percent in the past few weeks. It also became clear this week that Statistics Canada revised its production forecast for the 2023 growing season from 2.2 million tonnes to approximately 32 million tonnes.

The question is disappointing

In Europe, wheat prices are relatively stable. De Matif is quoting between 215 and 220 euros per tonne for milling wheat still to be delivered this month. In the slightly longer term, for delivery in March and May, quotes are 15 euros higher per ton. The European wheat export market is facing a severe crisis. Demand for French wheat in particular is disappointing.

Russia is experiencing some difficulties in the global market due to a strong ruble and logistical challenges at ports due to stormy weather. European market analysts report that there is still little opportunity for European wheat compared to cheap Russian supplies. In its first projections for the 2024 growing year, the Russian Analytical Agency expects a harvest of about 90 million tons based on the winter area sown. This is comparable to last growing season.