European wheat prices fall as weak demand drives competition for buyers

European wheat prices dropped as weak demand intensified competition among sellers, while Black Sea shipments remained low due to ongoing disruptions.

The Platts wheat benchmark, the Milling Wheat Marker for FOB Black Sea ports, averaged $202.59/metric ton in October, down from $211.73/mt in September as buyers continued to avoid deep-sea ports. Russia's wheat exports reached 9 million mt from July to Oct. 27, down 43% year over year, mostly shipped from the Baltic, according to S&P Global Energy CERA.

"There is poor demand," a Russian seller said of the Baltic market.

Traders said tight Baltic supply and committed November volumes limited further losses, while bad weather is expected to slow December loadings.

"Half of a month in December will be rainy and snowy; who will load vessels then?" a second seller of Russian wheat said.

FOB Russian Baltic 12.5% wheat prices fell to $258-$260/mt Nov. 2, down from the $270s/mt last week.

On the illiquid deep-sea trade, a seller said a Black Sea peace deal could lift prices to FOB $230/mt but said for now: "It is still not safe. No vessels will go there." Some sellers were still trying to move cargoes bought at much higher price levels, while inland costs continued to rise. "Rail tariffs and CPT prices are up, but the FOB market is down," a fourth seller said.

Russia is expected to export 3 million mt of wheat in November, unchanged from October, according to analytical center Rusagrotrans. Despite local news about some security guarantees for Azov Sea flows, traders saw little change compared to last month. No grain vessels were scheduled to load at Azov Sea ports or via Kavkaz in November.

"Whenever they allow Novorossiysk, it changes the game," the second seller said. "For now, it means nothing. No corridor. No port opened," the fourth seller said.

Egypt buyers on the sidelines

Platts, part of S&P Global Energy, assessed CIF East Med basis Egypt 12.5% wheat at $306/mt on Nov. 2, down $12/mt week over week. Buyers were cautious as the Egyptian pound weakened to a record low of 56 EGP/$1, anticipating further price declines.

"I think [the price] will continue to drop," a buyer said, adding that they were well covered, having received two vessels and expecting two more.

"I believe the market is frozen for now. Buyers will have to wait and monitor prices and developments," a second buyer said.

Locally, the Ex-warehouse Russian 12.5% wheat also fell by EGP 500/mt to EGP 18,000/mt, partly driven by the state's wheat sales to private mills at a subsidized price of EGP 16,650/mt.

Private buyers handled all wheat arrivals July-October. State-buyer arrivals are set to resume in November after recent purchases of five French and two Romanian cargoes. Imports since January total 9.2 million mt, just 600,000 mt below last year.

Ukraine shifts to Danube, Romanian routes

Ukrainian exports totaled 3.6 million mt from July to Oct. 27, down from 6 million mt a year earlier due to deep-sea disruptions, according to S&P Global CERA. Wheat shipped via Constanta rose 294% to 559,000 mt by Oct. 26.

In the coaster market, Ukrainian wheat went mainly to Egypt, Tunisia, Greece and Lebanon, with CIF Egypt bids at $305/mt for November loading, at 11.5%. In October alone, Ukraine shipped 137,400 mt of wheat from Izmail and 202,637 mt from Reni, according to traders' lineups.

CVB demand limited by quality concerns

Romanian and Bulgarian wheat saw weak demand from key ports due to quality issues and recent attacks in the region. Traders also warned availability may tighten later in the crop year.

"Bulgarian quality is too low in terms of W index. We avoid this origin," another buyer in Dubai said, opting for French wheat instead. Platts assessed the 12.5% CVB at 287/mt and 11.5% at $273/mt, an over $90/mt premium to the Marker.

"CVB wheat is competitive, but let's see if we have the quality," a Romanian seller said. CVB farmers continued to resist lower prices, limiting selling and keeping physical premiums firm despite weaker futures.

Bulgarian soft wheat exports rose 31% to 2.40 million mt in July-October, with Spain the top destination amid lack of Ukrainian exports. Constanta soft wheat exports grew 40% to 3.88 million mt, boosted by higher shipments to Algeria, Saudi Arabia, and Jordan. In the final week of October, both Jordan and Tunisia secured wheat at lower prices than in their previous tenders, with Jordan paying $18.05/mt less and Tunisia's by $12.24/mt.

Elsewhere, Bangladesh wheat importers are delaying purchases as prices are stable and stocks are sufficient, with buying expected to pick up in the coming weeks for Argentine wheat coverage.