Mumbai, 21 Nov (Commoditiescontrol): Wheat growers in major exporting nations are withholding sales as prices linger near four-year lows, creating supply challenges for millers in Asia and the Middle East. Typically holding three to four months of inventory, flour makers are now covered for just two months in Asia and 45 days in the Middle East, according to industry sources.
Plentiful harvests in Australia and Argentina, along with improved growing conditions in the U.S. and Black Sea region, have pushed prices to their lowest levels since 2020. Black Sea wheat with 12.5% protein is being offered at $265 per metric ton, C&F to Asia, down from $275 recently, while Australian Premium White wheat has dropped to $280 per ton from $290.
Farmers dissatisfied with these rates are hoarding their crops, anticipating better prices. Australian farmers are prioritizing sales of more lucrative crops such as chickpeas and canola, while U.S. growers are storing wheat in silos. High interest rates have further discouraged millers from holding large inventories, leaving them exposed to price surges if supplies tighten.
Despite strong southern hemisphere production, global wheat stockpiles are projected to hit a nine-year low by mid-2025, making the market vulnerable to weather-related disruptions in northern hemisphere crops ahead of the July harvest.
Russian farmers, encouraged by attractive interest rates, have increased sales, offering temporary relief. However, Russia's grain export quota from February to June is expected to sharply reduce shipments, adding to supply concerns. With limited reserves and ongoing production risks, any disruption could trigger sharp price increases, fueling food inflation.
(By Commoditiescontrol Bureau; +91-9820130172)
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