Agro Perspectiva

International prices of wheat and maize rose sharply in September but those of rice edged down

21.10.2020 13:55 "Agro Perspectiva" (Kyiv) — International prices of wheat made solid gains in September underpinned by brisk trade activity amidst increased uncertainties over production prospects in Argentina and Australia, and dry conditions adversely affecting winter sowing in many parts of Europe. Continued strong export sales and a generally tighter domestic supply situation than earlier anticipated resulted in a sharp increase in the benchmark US wheat (No.2 Hard Red Winter, f.o.b.), which averaged USD 246 per tonne in September, up 12 percent from August and 23 percent higher than the corresponding month last year. Driven by faster pace in sales, particularly to Egypt, export quotations in the Black Sea also registered notable gains, rising by more than 11 percent since August.

Export prices of all major coarse grains also increased significantly in September with the price of maize, the largest traded coarse grain, registering double‑digit increases, in response to reduced production prospects, especially in the European Union, and lower inventories in the United States of America. Complimented with continued large sales to China (mainland), the benchmark US maize (No.2, Yellow, f.o.b.) prices averaged USD 165 per tonne in September, up 12 percent from August and 5 percent from September 2019. In Argentina, concerns about drier‑than‑normal weather conditions and recent currency control measures, which were expected to push up input costs, also lifted maize export prices by as much as 13 percent, month on month. Deteriorating production outlooks in the Russian Federation and Ukraine provided support to the Black Sea export values, which were up 4 percent from August.

By contrast, international prices of rice subsided in all the major market segments. This was reflected in the FAO All Rice Price Index (2014‑2016=100), which averaged 111.6 points in September, down 1.4 percent from August. In Asia, September quotations of Indica rice fell the most in Pakistan and Viet Nam. In the former, declines coincided with the onset of the 2020 harvest, while in Viet Nam the partial relapse in export quotations was linked to concerns over the issuance of import licenses in the Philippines. By contrast, prices firmed in Thailand, as increasingly tighter exportable availabilities outweighed the downward pressure from low buying interest. Ahead of the launch of the «Kharif» harvest, African purchases also raised parboiled values in India, but prices of other grades either steadied or fell mildly as demand remained otherwise thin. In the United States of America, harvest progress lowered Indica quotations some more.