Economic Reporter :
Grain millers in Bangladesh are turning their heads toward Russia and Ukraine from India for their wheat purchases as cargoes from the country’s next door neighbor, key exporter fade due to a supply squeeze in that country.
Bangladesh has booked about 800,000 tonnes of wheat from the Black Sea region for shipment between mid-July and October, up from around 550,000-600,000 tonnes in the same period last year, two trade sources said.
Strong demand from South Asia’s top wheat importer and other key buyers could help buoy benchmark futures, which have been recovering from a 10-year low of $3.99-1/4 a bushel hit earlier this month due to pressure from plentiful global production.
“India is out of the market, Bangladesh buyers are taking larger volumes of feed wheat as well as milling grade wheat from Russia and Ukraine,” said one Singapore-based trader.
“It is all about prices, most Bangladeshi millers take the cheapest origin.”
Buyers paid $155-$168 a tonne, free on board, for Black Sea feed wheat with about 10.5-percent protein content, the sources said. They declined to be identified as they were not authorised to speak with media.
For milling wheat with 11.5- to 12.5-percent protein, importers have paid $165-$180 a tonne FOB, they said.
India has been exporting wheat to Bangladesh for the last few years, but its recent crops have been hit by a severe drought linked to the El Nino weather pattern and by unseasonable rains.
Russia and Ukraine, two of the Black Sea region’s leading wheat producers, have seen bin-busting grain production.
Ukraine’s 2016 grain harvest is likely to be around 3 million tonnes bigger than the year before at around 63 million tonnes, agriculture ministry official Leonid Sukhomlin said earlier this week.
And Russia is facing a lack of grain storage as it remains on track to produce the largest cereal crop in post-Soviet history, said the head of Russia’s Grain Union. But analysts warned against relying too heavily on shipments from the Black Sea.
Grain millers in Bangladesh are turning their heads toward Russia and Ukraine from India for their wheat purchases as cargoes from the country’s next door neighbor, key exporter fade due to a supply squeeze in that country.
Bangladesh has booked about 800,000 tonnes of wheat from the Black Sea region for shipment between mid-July and October, up from around 550,000-600,000 tonnes in the same period last year, two trade sources said.
Strong demand from South Asia’s top wheat importer and other key buyers could help buoy benchmark futures, which have been recovering from a 10-year low of $3.99-1/4 a bushel hit earlier this month due to pressure from plentiful global production.
“India is out of the market, Bangladesh buyers are taking larger volumes of feed wheat as well as milling grade wheat from Russia and Ukraine,” said one Singapore-based trader.
“It is all about prices, most Bangladeshi millers take the cheapest origin.”
Buyers paid $155-$168 a tonne, free on board, for Black Sea feed wheat with about 10.5-percent protein content, the sources said. They declined to be identified as they were not authorised to speak with media.
For milling wheat with 11.5- to 12.5-percent protein, importers have paid $165-$180 a tonne FOB, they said.
India has been exporting wheat to Bangladesh for the last few years, but its recent crops have been hit by a severe drought linked to the El Nino weather pattern and by unseasonable rains.
Russia and Ukraine, two of the Black Sea region’s leading wheat producers, have seen bin-busting grain production.
Ukraine’s 2016 grain harvest is likely to be around 3 million tonnes bigger than the year before at around 63 million tonnes, agriculture ministry official Leonid Sukhomlin said earlier this week.
And Russia is facing a lack of grain storage as it remains on track to produce the largest cereal crop in post-Soviet history, said the head of Russia’s Grain Union. But analysts warned against relying too heavily on shipments from the Black Sea.
