{"id":21234,"date":"2024-09-10T13:35:56","date_gmt":"2024-09-10T13:35:56","guid":{"rendered":"https:\/\/www.selinawamucii.com\/news\/?p=21234"},"modified":"2024-09-10T13:35:58","modified_gmt":"2024-09-10T13:35:58","slug":"wheat-price-fluctuations-checkmating-eus-farmers","status":"publish","type":"post","link":"https:\/\/www.selinawamucii.com\/news\/2024\/09\/10\/wheat-price-fluctuations-checkmating-eus-farmers\/","title":{"rendered":"Wheat price\u00a0fluctuations checkmating EU\u2019s farmers"},"content":{"rendered":"\n

Wheat price fluctuations which usually hover between rallies and dips do not benefit Europe\u2019s farmers, Nieuweoogst<\/u><\/a> reported on September 9, 2024.<\/p>\n\n\n\n

On the flip side, fluctuating wheat futures in the Euronext trading platform in Paris  benefit traders who buy low and sell high.  <\/p>\n\n\n\n

August 2024 was a case study, where the price difference between the weakest and strongest September delivery contracts was \u20ac30 ($33.13).<\/p>\n\n\n\n

So, traders who bought the grain at August\u2019s weakest rate of \u20ac190 ($209.86) a tonne could sell it at the month\u2019s best rate of \u20ac220 ($242.99).<\/p>\n\n\n\n

Not for Farmers<\/strong><\/strong><\/h3>\n\n\n\n

But while traders hold on to their purchases till a rebound, producers have to sell their harvest and make room for the next crop. <\/p>\n\n\n\n

However, if recent low production estimates in Europe and Russia are credible, growers could see a substantial price improvement.\u00a0<\/p>\n\n\n\n

Falling Global Supplies <\/strong><\/strong><\/h3>\n\n\n\n

A June 2024 report <\/u><\/a>by the U.S. Department of Agriculture (USDA) predicts Europe\u2019s wheat output to dip to 130.5 million tonnes in the 2024-25 season.<\/p>\n\n\n\n

USDA further forecasts that Russia, the top wheat shipper in the world, will see a substantial production decline.  In June 2024, the agency further cut its May 2024 production forecast for Russia to 83 million tonnes for the 2024-25 season.<\/p>\n\n\n\n

Meanwhile, estimates by Russia\u2019s consultancy Sovecon, at 82.5 million tonnes, echo USDA\u2019s forecasts. If this happens, Russia will produce 10 million tonnes less wheat than its 2023-24 output.<\/p>\n\n\n\n

While this naturally indicates upcoming tight EU supplies and hence good farm-gate prices, this depends on production in non-EU countries.<\/p>\n\n\n\n

One of these is the United States whose 2024-25 wheat could rise by 800 million bushels, to 1.875 billion bushels. <\/p>\n\n\n\n

This U.S.\u2019 supply glut could fuel Russia to lower its prices as frequently happens to remain competitive, which in turn affects\u00a0Europe\u2019s producer prices<\/u><\/a> \u00a0<\/p>\n\n\n\n

Indeed, sources show that Russia\u2019s exporters are still exploiting every opportunity with their competitive offers.  This is despite forecasts that Russia\u2019s Western European competitors will improve their exports by a million tonnes to 35 million tonnes by June 2025.<\/p>\n\n\n\n

Finally, Canada could see 1.5 million tonnes more wheat production in the 2024-25 period than in the foregoing season.<\/p>\n\n\n\n

Wheat Price Fluctuations vs. Ukraine Exports<\/strong><\/h3>\n\n\n\n

On top of this, Ukraine is putting pressure on prices with a view to ship 16.2 million tonnes in 2024-25. <\/p>\n\n\n\n

Indeed, in the first two months of the season (July and August), the country had already shipped 3.8 million tonnes.<\/p>\n\n\n\n

USDA however expects Ukraine\u2019s shipments to decline by a million tonnes from 14 to 13 million tonnes by June 2025.<\/p>\n\n\n\n

All in all, global wheat output in the 2024-25 will remain 7.4 million tonnes down from its 2023-24 equivalent. This might mean slight improvements for European producer prices in the long term and ameliorate the\u00a0early 2024 price decline<\/u><\/a>. The data below further illustrates how differing production occasions wheat price fluctuations, at the export level.\u00a0<\/p>\n\n\n\n

EU Wheat Export Price Statistics <\/strong><\/strong><\/h2>\n\n\n\n

Wheat is a major agricultural produce in the European Union and accounts for 46.7% of the region\u2019s total cereal harvest (2022). Export prices play a critical role in commercial grains like wheat, depending on the yearly output. \u00a0The 2022 harvest, for instance, at\u00a0126.8 million tonnes<\/u><\/a>, was a slight fall from 2021 and hence occasioned an upward price effect. Europe\u2019s Grade 1 wheat export prices increased in March 2022 by\u00a012.5%,\u00a0<\/u><\/a>year-on-year from the supply dip, per USDA data. For the 2024-25 season, the European Commission expects a production slump to\u00a0116 million tonnes<\/u><\/a>. This is against an USDA June 2024 estimate of\u00a0130.5 million tonnes<\/u><\/a>. Depending on global production trends in the same year, Europe\u2019s wheat prices could also change given this downward estimate.\u00a0<\/p>\n\n\n\n

How do September 2024 export prices in Europe compare to those of North America<\/strong>?  <\/p>\n\n\n\n

Data by the European Commission for September 3, 2024 shows Europe-outbound wheat sold at \u20ac217<\/u><\/a> ($249) a tonne in Paris. This pricing is similar to the American soft red wheat for the 3rd<\/sup> of September. In comparison, Canada\u2019s export price at St. Lawrence on 3rd<\/sup> September was at \u20ac267 ($295) a tonne. This is even as the United States\u2019 hard red winter traded at \u20ac246 ($271) a tonne. But EU\u2019s durum wheat from France, at \u20ac285 <\/u><\/a>($314) a tonne, carried the day among varieties. <\/p>\n","protected":false},"excerpt":{"rendered":"

Wheat price fluctuations which usually hover between rallies and dips do not benefit Europe\u2019s farmers, Nieuweoogst reported on September 9, 2024. On the flip side, fluctuating wheat futures in the Euronext trading platform in Paris  benefit traders who buy low and sell high.   August 2024 was a case study, where the price difference between the weakest…<\/p>\n","protected":false},"author":3,"featured_media":18204,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[2],"tags":[],"yoast_head":"\nWheat price\u00a0fluctuations checkmating EU\u2019s farmers - Selina Wamucii | Food & Agriculture News<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.selinawamucii.com\/news\/2024\/09\/10\/wheat-price-fluctuations-checkmating-eus-farmers\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Wheat price\u00a0fluctuations checkmating EU\u2019s farmers - Selina Wamucii | Food & Agriculture News\" \/>\n<meta property=\"og:description\" content=\"Wheat price fluctuations which usually hover between rallies and dips do not benefit Europe\u2019s farmers, Nieuweoogst reported on September 9, 2024. 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