India to impose 10 percent import duty on wheat

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  India will introduce a 10 percent import duty on wheat to curb overseas purchases when there are ample domestic stocks.

  From WATTAgNet:
  India will introduce a 10 percent import duty on wheat to curb overseas purchases when there are ample domestic stocks.
  Indian flour millers and global trading companies closed deals to import 500,000 tons of Australian wheat between March and June -- the biggest amount in more than a decade, despite surplus stocks.
  Millers first placed the orders in India’s southern ports over concerns that February and March rains could cut wheat output, especially the high-protein varieties used to make pizzas and pasta. Attractive prices -- $255 to $275 per ton -- then prompted Cargill, Louis Dreyfus and Glencore to follow.
  India, the world’s second-largest producer and consumer of wheat, has large stockpiles of the grain after eight consecutive years of bumper harvests. This year’s wheat output for India is estimated at about 90 million tons, which is 5 percent lower than in 2014, but still exceeding domestic demand of 72 million tons. After unusually high temperatures in 2006-07, the country was forced to import millions of tons of expensive wheat from Russia and Australia.
  Top officials from the ministries of farm, food, trade and finance reportedly have agreed to the import duty to cut imports. Prime Minister Narendra Modi must sign off on the move.

Pakistan seeks 50 percent duty on wheat imports

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  Pakistan is seeking a 50 percent regulatory duty on the import of wheat.

  
  From WATTAgNet:

  Pakistan’s Ministry of National Food Security and Research has sought a 50 percent regulatory duty on the import of wheat, in an effort to discourage purchase from overseas markets due to a surplus.
  The proposal is awaiting final approval from the Economic Coordination Committee.
  The previous 25 percent regulatory duty on wheat recently was raised to 40 percent.
  Some provinces, such as Sindh, have been the victim of substandard wheat imports this year, despite the high-quality wheat produced in the country. Therefore, the provinces recommended the duty increase.
  An official says prices on the international market are lower than Pakistan’s rates, and traders were importing wheat from other countries to sell it cheaper in the local market.
  Because of the imports, “a huge quantity of surplus stock from the previous year is already stored in the country and another bumper crop has started hitting the market,” an official said.
  The World Trade Organization forbids countries from banning the import of any commodity in an open competitive market, so the regulatory duty is the country’s only option to discourage imports.

Egypt’s Gasc buys wheat below $200 per ton

Egypt’s grain authority, Gasc, bought wheat at less than $200 per ton, including freight, for the first time in at least two years, according to a report.
The deal highlights the rich supplies offered in Russia not that the country has lifted its export duty.
Gasc bought 240,000 tons of wheat for $47.8 million – an average of $199.28 per ton on a cost and freight basis. That was less than the $205.76 per ton at the last tender three weeks ago, and the $270 per ton it was paying in December.
The low price reflects the supplies on offer after a record world harvest in 2014 and a strong crop expected in 2015.
The International Grains Council recently raised its forecast for global wheat output in 2015-16 by 10 million tons to 715 million tons.
At the latest tender, Gasc was offered 14 cargos of wheat, down from 17 at the previous tender. Nine of the cargos were from Russia, totaling 180,000 tons, and the rest from Romania at 1.2 million tons. France remains the top country of origin for Gasc purchases in 2014-15, but only one French cargo was offered at the most recent tender.
Egypt is the world’s top wheat-importing country.

Traders concerned about U.K. wheat hoarding by farmers

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  Wynnstay Group has warned that U.K. growers are hoarding “significant” quantities of grain from last year’s harvest.

  From WATTAgNet:
  Feed manufacturer Wynnstay Group has warned that U.K. growers are hoarding “significant” quantities of grain from last year’s harvest. It said there are concerns the hoarding could exacerbate weakness in the U.K.’s wheat prices.
  "Farmers are still holding significant stock from the 2014 harvest," which for wheat saw production soar 39 percent to a six-year high of 16.61 million tons.
  A more than one-quarter drop in U.K. wheat prices over the past year has been cited for deterring farmers from selling.
  Traders have expressed concerns amid a 2014-15 wheat program that is falling short of expectations.
  "The U.K. has a mountain to climb to clear the stores before harvest, especially if imports continue at their current rate," said traders at one major European commodities house.
  It is estimated that the U.K. has an exportable surplus of 3.5 million tons of wheat for 2014-15, but had shipped only 1.08 million tons as of January. That is only 5,971 tons ahead of imports for the marketing year.
  There is a belief that U.K. statistics may be incorrect; some traders think official data are exaggerating production or inventories. The U.K. farm ministry last month unveiled a data review "to achieve consistent cereals balance sheet estimates," after acknowledging discrepancies.

Wheat price rally expected to end soon

The biggest wheat price rally to start the year since at least 1960 will soon end, analysts say, as the world’s farmers are growing more wheat than ever.
Global stockpiles of wheat on May 31 will be 5.8 percent larger than a year earlier, a Bloomberg survey of 15 analysts showed. Informa Economics Inc. says output will then rise to a record, despite smaller U.S. and Black Sea crops.
Farmers in the U.S., which is the top exporter, account for less of the world wheat after 10 years of output gains in other countries. Canada, the No. 2 exporter, will see inventories double to a two-decade high, and bigger crops are forecast from Australia, Argentina and across Europe. Morgan Stanley predicts price gains will stall, and Goldman Sachs forecast a drop of 24 percent by mid-October.
“We’re in a market that is being driven by fear at the present, and prices have been diverging away from fundamentals,” Christopher Gadd, a commodities analyst at Macquarie Group Ltd., said in a report. “We are going to see a big harvest in the Northern Hemisphere, despite the losses in the U.S.”

US wheat prices fall, soybeans near 1-month low

U.S. wheat fell on May 7, after climbing to its highest in 13 months, as a heat wave hit the plains states and political turmoil in Ukraine threatened to reduce supplies.
Soybeans fell for a third consecutive session and was trading near the one-month low from May 6, due to rising global oilseed supplies and slowing demand from China.
Chicago Board of Trade (CBOT) July wheat fell 0.3 percent to $7.36-1/2 a bushel. Front-month May wheat contract fell 0.2 percent to $7.29-3/4 a bushel, after closing up 1.5 percent in the previous session when prices hit $7.35, the highest spot price since early April 2013.
July soybeans fell 0.3 percent to $14.54-1/4 a bushel, not far from $14.43-1/4 a bushel from Tuesday, its lowest since April 7. July corn rose 0.2 percent to $5.18-3/4 a bushel.
The Chicago wheat market was pausing while it awaited U.S. Department of Agriculture (USDA) reports on May 9, Arnaud Saulais of Starsupply Commodity Brokers said in a Reuters report. "It is common to see the markets pull back one or two days before the USDA reports, although wheat is still well supported by the hot weather in U.S. grain belts."
Temperatures in parts of the southern Plains topped 100F on May 5, and unseasonably high temperatures and high winds persisted on May 6.
On May 9, the USDA on will release its first official production estimate of the U.S. wheat crop, along with initial forecasts for U.S. and world grain 2014-15 ending stocks.
"I do not think U.S. wheat is facing a resistance level; it is more of a general pause in the market," Saulais said.
The USDA said 31 percent of the U.S. winter wheat crop was in good to excellent condition, down from 33 percent a week earlier.
As for the U.S. corn crop, the USDA said it was 29 percent seeded, lagging the five-year average of 42 percent and behind an average trader estimate of 33 percent.
Wheat and corn were drawing support as fears grew that Ukraine’s exports could be curbed. In China, demand for soybeans were slowing.

Bunge sees surprising first-quarter loss

Bunge Ltd. reported a surprising first-quarter loss, sayingit had bet wrongly on a drop in wheat prices.
Bunge saw a $27 million loss in the first quarter of 2014 and cited a 55 percent slump in its trading and distribution division. It says political turmoil in Ukraine had affected its strategy.
"We expected a lower price environment, particularly in wheat, which did not materialize,"Bunge Chief Executive Soren Schrodersaid in a Reuters report. "Political turmoil in the Black Sea and deteriorating winter wheat conditions in the U.S. were the primary catalysts for the wheat rally, which ignored the more-than-adequate global stocks."
Bunge lost 18 cents on a per-share basis, missing analysts’ expectations of a $1.40-per-share profit on average. It had earned a profit of $170 million a year earlier.
Profit in Bunge’s agribusiness unit, which includes trading and distribution, fell to $79 million for the quarter.

Corn, wheat futures rise as tension in Ukraine builds

Chicago Board of Trade (CBOT) wheat and corn futures rose as political strife in Ukraine led to fears of disruption of shipments from the Black Sea, a key grain-exporting zone.
Ukraine is a major exporter of wheat and corn. Wheat futures were up 5.2 percent and corn futures were up 3.8 percent. In Europe, May milling wheat rose 4.6 percent to its highest in nearly three months.
"The market is concerned that the tensions in that part of the world could curb export activity," Luke Mathews, commodities strategist at Commonwealth Bank of Australia, told Reuters. "The importance of the Black Sea region to global grain markets should not be understated."
Ukraine is expected to export 16.8 million metric tons of corn in the 2013-14 season. Analysts and traders said there were no signs yet of trade disruption and that the market was reacting to risks raised by uncertainty caused by growing tensions in the region.
"The market is not reacting to new fundamental factors but is being driven by investment funds that are short and that are reacting to a geopolitical context of uncertainty," Michel Portier, head of grains consultancy Agritel, said in the report.
Others are viewing this uncertainty as an opportunity to capitalize on the instability of the Ukrainian currency.
"I think people are overexcited," one European trader said. "I talked with my corn supplier in Ukraine, this week he will be loading corn to us and today he even bought additional quantities - the price for him is very attractive because of the low exchange rate."

Argentina wheat acreage to expand 40 percent in 2013–2014

Argentina wheat farmers plan to expand their 2013-2014 crop by 40 percent compared to the 2012-2013 crop year, to nearly 4.5 million hectares, according to Agriculture Secretary Lorenzo Basso. The 2012 season brought in 3.16 million hectares, the smallest area on record, according to the country's government.
Argentina is giving tax rebates to farmers to compensate for a 23 percent levy on wheat exports and help reverse a trend on growing other crops. "Wheat planting area will increase for several reasons: The rebates, good soil moisture and better market conditions," said Basso.
Argentina officials have authorized the export of 5 million metric tons of wheat for the 2013-2014 season as part of the drive to increase production.

Animal feed costs could drop as grain prices forecast lower

Poultry and livestock producers should see some relief from high animal feed costs, as the price of corn, soybeans, wheat and sorghum have all been forecast lower, according to the United States Department of Agriculture’s World Agricultural Supply and Demand Estimates report, released on March 8.
Corn prices are projected 20 cents a bushel lower, with a range of $6.75 to $7.45. Part of that drop in price is based off of the emerging crop in South America and South Africa. The USDA’s World Agricultural Production report, also released on March 8, reflected Argentina’s corn production 26 percent above last year’s crop with yields improved by 30 percent. The same report projected South African corn production to be up 5 percent from last year.
Projected U.S. corn ending stocks are unchanged this month as an increase in imports and lower exports support higher expected feed and residual disappearance. Imports are raised 25 million bushels, reflecting the strong pace of shipment reported through January. Meanwhile, exports are lowered 75 million bushels, based on the slow pace of sales and shipments, as well as the strong expected competition from South American corn and competitively priced feed quality wheat.
The projected season-average price range for soybeans is narrowed 25 cents, with a range of $13.80 to $14.80 per bushel. Soybean meal prices are forecast at $425 to $445 per short ton, which is down $10.
U.S. soybean supply and use projections are unchanged, leaving ending stocks at 125 million bushels. Although soybean export commitments through February exceeded last year’s pace, exports are expected to decline in upcoming months due to increased competition from South America.
Sorghum prices are forecast 20 cents a bushel lower, with a range of $6.70 to $7.40. Exports are projected 10 million bushels higher, based on the strong pace of sales and shipments.
Wheat, meanwhile, is forecast at 10 cents a bushel lower with a range of $7.65 to $7.95. Key to the drop is increased supplies, as global supplies are raised 1.8 million tons with higher production. India’s production alone is increased at 1 million tons.

Wheat prices could rise on US corn concerns, lowered supplies

Reduced prospects for U.S. corn production from the 2012 harvest, in addition to concern over possible reductions in wheat supplies from traditional areas such as the Black Sea due to lower yields and restrictions on exports, could result in an increase in wheat prices, according to UK-based Offre & Demande Agricole.
In June, the U.S. Department of Agriculture estimated the average U.S. corn yield at 166 bushels per acre, which combined with a record planted area of 96.4 million acres led them to forecast a potential 2012 harvest of 375.7 million metric tons. However, the U.S. has experienced the driest, hottest June in over 50 years, which has led to a deterioration in growing conditions and a decline in yield expectations. “Although some of the damage to potential yields may be reversed if there is significant rainfall before harvest, Offre & Demande Agricole’s estimate for the 2012 U.S. corn harvest is 351 metric tons, some 25 metric tons lower than the USDA’s last-published figure," said Offre & Demande Agricole. "If less corn is available for feed manufacturers that will increase demand for wheat and barley, with prices following suit."
Although the market is expecting a good global barley harvest, there are concerns over wheat supplies, especially from the Black Sea region, due to hot, dry conditions. Russia has reduced its production estimate from 56 metric tons to 46–49 metric tons, which would cut the potential export surplus by 9 metric tons compared with 2011 and raise concerns over a possible export ban. “Wheat prices are also being driven higher by the situation in Ukraine, which is even worse than in Russia," said Offre & Demande Agricole. "Harvest has started in South Ukraine and yield reductions of up to 40 percent compared with last year are being reported. Stocks are lower than officially stated and there are concerns that the elections which will be held in the autumn could lead to a ban on wheat exports in order to keep domestic prices low."

Tyson stops using wheat in poultry feed

Tyson Foods Inc. has stopped using wheat in its poultry feed due to prices rising above those for corn, according to reports, ending a practice that began in 2011 when wheat prices fell below those of corn for the first time in 15 years.
The change in current practice, which other companies are also headed towards, could put a strain on U.S. corn supplies, which are set to drop to their lowest level in 16 years during the summer, say analysts. "If the price spread between wheat and corn narrows some more, we may work it back into our feed ingredient formula," said Tyson spokesman Gary Mickelson. The U.S. Department of Agriculture has projected feed and residual use of U.S. wheat for the 2012–2013 marketing year that began June 1 at 230 million bushels, a 50 million-bushel rise from 2011–2012 and the highest level in four years.

EU forecasts 2012 wheat harvest up 2 percent

The EU soft-wheat harvest will rise an estimated 2 percent in 2012, to 131.4 million metric tons from 2011's 128.8 million metric tons, according to the European Commission.
Stocks of the wheat may climb to 13.8 million metric tons by the end of June 2013 from 10.1 million metric tons, with feed use falling by 2 million metric tons to 53 million metric tons. Output of durum wheat could rise to 8.4 million metric tons from 8.1 million metric tons, according to the commission.
The EU's barley harvest is also forecast to climb, to 54.7 million metric tons from 2011's 51.3 million metric tons. Corn production may drop, to 62.2 million metric tons from 66.8 million metric tons, with ending stocks settling at 9.3 million metric tons from 13.2 million metric tons.

US corn, wheat forecast up, soybeans down

U.S. farmers will plant 95.012 million acres of corn in the current crop year, up from the previous year's 91.921 million acres and above the 94 million acres forecast on February 24, according to a survey conducted by Allendale Inc.
Wheat planting is expected to rise to 56.609 million acres, but soybeans are forecast to drop to 74.495 million acres from 74.976 million acres. The U.S. Department of Agriculture's February 24 forecast set soybeans at 75 million acres sown.

Japan buys feed wheat, barley via buy and sell tender

Japan's Ministry of Agriculture has purchased 59,690 metric tons of feed wheat and 93,640 metric tons of feed barley in a tender under the simultaneous buy and sell system.
Under the system, end-users can negotiate the origins, price and quantity of grain with trading companies prior to jointly submitting bids to the government. In October 2011, the ministry revised up its imports of feed wheat in the fiscal year to March 31 to 430,000 metric tons to reflect users' need for an alternative to costly corn in compound feed. It initially planned to buy 300,000 metric tons during the same period, according to reports. Its purchase plan for feed barley remains at 1.41 million metric tons for the fiscal year.

China may increase corn and wheat imports, report predicts

The China National Grain and Oils Information Centre published its latest report, which expects China will increase its corn and wheat imports.
According to the report, in the year ending September 30, corn imports reached an estimated 4 million tons, up 3.02 million tons from last year, and wheat imports increased by 700,000 tons to 1.5 million tons in the year ending May 31.
CNGOIC's report predicted wheat consumption of 18 million tons, an 8.8% increase in corn consumption to 177.1 million tons, including 107.8 million tons of corn for feed use, up 7.8% from last year. Consumption of corn for industry use will increase by 5.5 million tons. 

Japan may purchase less corn, more wheat to cut costs

Japan's livestock producers may purchase less corn as feed-wheat imports quadruple to the highest levels since 2001 on prices $50 per ton cheaper than U.S. corn, according to reports.
Wheat imports may reach 430,000 metric tons, from 112,000 metric tons in the year ended March 31, according to Ikuho Tomita, deputy director at the agriculture ministry's feed supply and demand planning office. Imports were at 473,000 metric tons in 2001. “Increased purchases of feed wheat means Japan’s corn imports will decline, as overall demand for feed grains isn’t growing,” said Tomita. Japan’s feed makers “are taking advantage of an expanded gap in purchasing costs between corn and wheat.”
Japan imported 169,318 metric tons of feed wheat in the nine months ending September 30, according to finance ministry data.

UK 2011 wheat, winter barley harvests down

UK wheat production for the current harvest year is estimated at around 14.67 million metric tons, down on the five-year average by 1.5%, with plantings up 3.9%, according to an NFU survey. Winter barley production is estimated at 2.079 million metric tons, down 18.9%, with plantings down 10.1%. Spring barley production is estimated at 3.229 million metric tons, up 3.7%, with plantings up 3.8% on the five-year average.
This year’s NFU wheat yield estimate is 7.4 metric tons per hectare and 5% down on the five-year average; winter barley is 5.8 metric tons per hectare and 9.6% down; spring barley is 5.3 metric tons per hectare with no change on the five-year average. “The key to understanding the impact for farmers from these results is the huge variability in yields we have seen this year, far more than in recent years," said Ian Backhouse, NFU combinable crops chairman. "Some members have seen field or even whole farm record production in 2011, while others have had one of the poorest harvests on record. I believe this year’s overall wheat and winter barley yield decrease was largely due to tough growing conditions last spring, including one of the lowest ever rainfall levels recorded for the first half of the year across the majority of England.  However...spring barley performed far better across the UK than was feared, with the rain appearing in time to save [this crop] for most farmers."
According to Backhouse, farmers invested significantly in preserving grain quality. “The Home Grown Cereals Authority reports that wheat quality is very good this year, with a higher proportion expected to achieve full milling specification than for a number of years," said Backhouse. "Many report crops weighing heavier and high bushel weights are partly compensating for lower volume harvested. Following a very dry spring and rains disrupting summer harvest in 2011, farmers invested in grain drying to protect quality and overcame a challenging season.”

South Korea to expand overseas corn, wheat farming

South Korea is making plans to secure 380,000 hectares of overseas farmland by 2018 in order to grow crops like corn and wheat and secure a more stable food supply as prices continue to rise, according to the country's agriculture ministry.
The government plans to help South Korean companies lease arable land or buy stakes in overseas firms, prioritizing in countries such as the Philippines, Cambodia, Ukraine, Indonesia and Russia. South Korea also plans to expand its overseas grain trading business into countries including Brazil, Russia and Ukraine, according to the ministry.

US wheat supplies, production down from 2010 numbers

Projected ending U.S. wheat stocks for the 2011-2012 harvest year are 687 million bushels, down 122 million bushels from the 2010-2011 year, according to the U.S. Department of Agriculture.
Total wheat supplies for 2011-2012 are projected down 307 million bushels, due to both smaller carryin stocks and production from 2010-2011, according to the USDA. Beginning stocks are at 809 million bushels, down 30 million bushels from May. Projected imports, at 110 million bushels, are unchanged from May, but up 10 million bushels from the 2010-2011 year.
Total projected wheat use is down 185 million bushels from 2010-2011, to 2.29 billion bushels, in spite of higher domestic use. Food use is projected at 945 million bushels, up 15 million bushels from 2010-2011, but exports are down 245 million bushels, to 1.05 billion bushels.
Total production is projected at 2.06 billion bushels, down 150 million bushels from the 2010-2011 harvest year.