Frontrunner - 18th February 2022
World wheat markets have seen less volatile trading than they have over the past three to four weeks, but prices continue to be underpinned by the worsening situation in Ukraine. US President Biden said on Thursday that there was now every indication that Russia was planning to invade Ukraine in the next few days. Should this be the case, it seems likely there would be interruptions to wheat exports from the Black Sea region, which is a serious concern considering that Russia, Ukraine and Romania continue to dominate international tenders. This week, Algeria’s State grains agency (Office Algerien Interprofessionnel des Cereales), known internationally as the OAIC, is thought to have bought as much as 720,000 tonnes through this week’s tender process with offers from several origins including the Black Sea, Argentina and its traditional primary supplier, France. Romania is thought to be the most likely origin given the competitiveness of its pricing. Romania also took the honours in capturing all the sales to Egypt in its tender this week. The General Authority for Supply Commodities (GASC) was spoilt by a long list of offers also including Russia, Ukraine and France and confirmed a purchase of 180,000 tonnes. The selling price, at an average of $338.50/t including freight for April delivery, is about $10/t below its previous purchase at the end of January. Romania, benefitting from ideal weather during the growing cycle, had a record-yielding 2021 wheat crop at 10.4 million tonnes, which was up by over four million tonnes on the previous year.