Wheat: Local prices persist firmly on the background of regional surpluses
November 9, 2017 at 4:34 PM ,
Starry Night Ltd.
BULGARIA. During sowing, the weather conditions were quite favorable for farmers to take advantage of the utmost possible environmental factors. According to the Ministry of Agriculture, by the 2nd of November 2017, estimates of sowed arable land with wheat stood at 938,244 ha. Before the start of season 2017-18, farmers stood before 1,100,492 ha available land for harvest. This year, the country is expected to allocate more land for the cultivation of the grain because of the enormous export potential for the crop, which has been mounting since the beginning of the current marketing season. Indeed, the soil and climate conditions within the North regions are quite favorable for the cultivation of the grain.
Wheat: overwhelming availability in the region fails to push down local prices
Although local quality characteristics of wheat are not to be compared to those of the other export-oriented countries in the Black sea basin such as Ukraine and Russia, this year, overall, farmers realized much higher quality wheat than they did during the previous one. And, although it was quite clear from the very start of marketing season 2017-18 that there would be a surplus availability of wheat in the Black sea region, local prices, rising from the low levels in the beginning of the buying campaign, have grown firmer on a monthly basis, as exports continue to grow. Last year, at about this time, local prices hiked and followed a steep upward trajectory till the very end of the season. By the 3rd of November 2017, according to local authorities, remaining stocks stood at 3,051,780 mt.
|
Harvest 2017-18 (01.07.2017 - 03.11.2017) units in MT |
|
|
Beg. availability, incl. carry over & imports |
6,115,640 |
|
Domestic consumption |
681,600 |
|
food |
341,000 |
|
feed |
168,000 |
|
seeds |
160,000 |
|
industrial usage |
12,600 |
|
Exports to the world |
2,382,260 |
|
to EU markets |
2,119,012 |
|
to rest of the world |
263,248 |
Source: Bulgarian Ministry of Agriculture
Medium-term speculations on prices are out of the question, but the prevailing market sentiment among local market players is that the high quality characteristics of the grains and the surprisingly strong foreign demand will maintain the high export drive at least till the end of February 2018. The majority of exports go to EU markets.
|
Wheat, Bulgaria |
|
|
Type |
EUR/kg |
|
milling wheat |
0.143 |
|
feed wheat |
0.135 |
|
EXW Bulgaria |
|
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