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Wheat: the strong harvest will boost exports

August 21, 2017 at 12:33 PM , Starry Night Ltd.
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The high quality crop and competitive prices boost exported volumes. Prices are expected to fall even further.

SOFIA. Although it is early in the marketing season, prices of milling wheat and feed wheat already reflected the downward price trend in the Black sea basin. The reason is higher than expected supply of wheat, coming from the major producers of the crop in the region. Short-term expectations are for local prices to follow a downward price trend.

Wheat: strong harvest, strong exports

The greater the aggregate output of wheat, the higher the export activity. A case in point, during season 2016-17, the country produced 5,662,721 mt of wheat and exported 4,168,623 mt.

Harvest 2017-18

(01.07.2017 - 11.08.2017)

Carry over

   179,000 mt

Domestic output

5,710,084 mt

Domestic consumption

   184,800 mt

Exports to the world

   837,458 mt

Source: Bulgarian Ministry of Agriculture

So far in the year, estimates are for farmers to have collected 5,710,084 mt of higher on a year-to-year basis quality crop. Competitive prices in the region skyrocket exports and projections are for even higher than last year’s shipments abroad, mainly to EU member countries. According to the Ministry of Agriculture, by the 11th of August 2017, exports amounted to 837,458 mt, as close to 86% went to EU markets.

Competitive prices: a knife with two blades

The persistent downward price trend has already risen substantially exported volumes. However, the recent accelerated export activities to foreign countries actually reflected already executed contracts, where quantities were set at higher prices. Whether the export trend will continue, at the lower prices, after the end of August remains to be seen. Shipping activity seems to be already slowing down.

 

Wheat, Bulgaria

Type

EUR/kg

milling wheat

0.144

feed wheat

0.137

EXW Bulgaria

 

 

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