10.
12.21
12:32

China is taking advantage of the share price weakness in Europe and buying wheat and corn in France

Chinese buyers made substantial purchases of French wheat and barley and Ukrainian corn and barley over the past week, trade sources said. They took advantage of a break from rising prices to meet part of their feed grain needs.
While total quantities were not yet clear, sources said importers had secured at least several hundred thousand tons of grain from France and Ukraine.
Chinese buyers also bought large quantities of Australian feed wheat, which in turn accounted for at least several hundred thousand tons, some sources added.
The agreements point to China's continued high demand for grain imports, despite a good domestic corn harvest and difficulties in the pig industry. This shows the willingness of buyers to absorb the decline in international prices.
Wheat futures surged to a nine-year high in the United States and a record high in Europe last month, fueled by concerns over rain damage to Australia's crop and Russian export restrictions, before declining sharply since last week.
For French wheat, buyers are said to have booked between six and ten ships or potentially up to 600,000 tons for shipping primarily between January and March, several traders said in unison.
The French wheat is believed to be mainly used for fodder, although some could be used for mill markets, the traders added.
"French wheat is currently attractively priced to the Chinese after falling from its highs," said a European trader.
"China is also believed to have made large purchases of wheat from Australia recently as China's economic recovery creates demand."
The latest sales would bring the cumulative exports of French wheat to China to 2 million tons in 2021/22, surpassing the already large quantities of the past two seasons, traders said.
Chinese buyers are also making forward purchases of 2022 harvested barley in France and Ukraine.
About four ships of French barley and up to 10 loads of Ukrainian barley were booked for shipping mostly in July-August next year, according to at least four traders, although some of the purchases could be optional stores that can be supplied by either country.
There has been continued interest from Chinese buyers in French wheat and barley, although no more deals were reported early Friday, traders said.
For corn, Chinese buyers ordered loads from Ukraine to ship January through April, four sources said. The estimates of the volume varied from several to 10 or more loads, with one source speaking of a total volume of up to 1 million tons.
Traders estimated prices for Ukrainian corn for January-February shipment to China this week at around $ 270-273 per tonne of fob.
As in a previous round of buying last month, Ukrainian corn appeared more expensive than US deliveries.Traders suggested that a US requirement to disclose large sales that could lead to price increases could deter Chinese buyers.
China has traditionally been a major importer of Ukrainian corn and barley. Traders estimate that Ukraine could deliver 5 million tons of corn to China from an expected bumper crop in Ukraine in 2021.

Source
Hansa Terminhandel GmbH
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