CBoT wheat and soybean futures prices continue to rise this morning. US market participants expect China to increase its purchases of US agricultural goods soon, once the "Phase One" deal is signed.
Wheat prices are also being supported by good demand on the world market. Iran bought 1 million tons of wheat, mainly from Russia, while Morocco needs to increase its imports and wants to reduce import tariffs to do so. China bought up to 1 million tons from the EU. Most of this comes from France.
Although China is the world's largest wheat producer, it still has to import several million tons to meet its national demand. However, it is rare for the EU to deliver wheat to China because the freight costs are so high. This year, however, tensions with the USA, Australia and Canada were so pressing that the decision was made to source wheat from the EU.
Source
HANSA Terminhandel
