The good wheat harvest is expected to lead to a decrease in grain prices

This year, global wheat production is expected to reach around 684 mln tonnes, or 3.5 mln tonnes more than the February outlook of the U.S. Department of Agriculture and the International Grains Council. This immediately affected the price of wheat grain in the U.S., France and Germany, which went down, announced Antonina Belopitova, Director of the Sofia Commodity Exchange (SCE). Global wheat production is projected to reach nearly 43 mln tonnes more than in 2011. The expected increase in wheat yields is primarily due to good harvests in Australia. The reduction of wheat prices, both in the US and on European markets, was predetermined by the intention of Russia and the Ukraine to export larger quantities of grain. Meanwhile, the outlook for wheat production in Europe was reduced by about 3-4 mln tonnes to 127 mln tonnes. The major producers of wheat and fodder grain in the EU - France, Germany, Poland, Britain and Spain - reported drought. In early February, the areas damaged by winter conditions were 5 mln decares, which implies future price increases for European grain. The Ukraine announced that around 45% -50% of the areas planted with ​​wheat are in poor condition. In Russia, only 6% -8% of these have been affected. As a result, the local wheat harvest is expected to reach about 56 mln tonnes.

The last sales of US wheat for the Egyptian wheat market were effected at a price level of $263 per tonne, which marked an 18% drop on an annual basis in the U.S., announced SCE. There was an 11% decline in wheat prices for German wheat - it is currently traded at $302 per tonne. France reported a 19% price decline for wheat - now, it is being sold at $286 per tonne. In March, Bulgaria reported a 23% price slump for wheat grain on an annual basis. At present, grain is traded at BGN 306 per tonne, VAT excluded, compared to BGN 470 per tonne a year ago.

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