Miller Magazine Issue: 156 December 2022

MARKET ANALYSIS 92 MILLER / DECEMBER 2022 through November 16. In this context, Argentina will only ex- port 6.5MMT of wheat in 2022-23 according to the Rosario Board of Trade, down from last week’s prediction of 7MMT (5-year average of 11.7MMT). And this forecast is optimistic, the worst one is around 10MMT of production. The European Union’s soft wheat exports so far in 2022/23 are 13.25 MMT, according to data from the European Com- mission. That was nearly 10% ahead of the same time a year ago. France remains the largest wheat exporter at 5.46 MMT, while Romania, Germany, Latvia, and Poland followed, ship- ping less than 2.0 MMT each since the July 1 export calen- dar began. Meantime, the French farm office FranceAgriMer reported that 97% of the country’s 2022/23 soft wheat crop has been planted as of November 14. The EU has greatly increased shipments of wheat and barley to the MENA coun- tries. In July 2022, the EU exported 1.9 MMT of wheat to MENA, which is 300% higher YoY. In total, July wheat exports from the EU reached 3 MMT, which is 74% more YoY. Such pace of shipments means that France’s export potential for wheat by December may be almost completely exhausted. According to the EC, by November 20, France had already exported 5.6 MMT of wheat (soft and durum) outside the EU, which is 1.6 times higher YoY. The export potential from France to countries outside the EU is estimated at 10 MMT in 2022/23. Taking into account the sale to China with delivery in December from 8 to 10 Panamaxes with French wheat (up to 600 thousand tons), some of which will most likely move to January 2023, 7.5 million can be shipped in the first half of the 2022/23 season. In 2021/22, the volume from July to December was 54% - 4.6 MMT out of 8.5MMT. Australia has accounted for 63% of China’s wheat imports during the first 10 months of 2022, compared to 28% over all of 2021 and just 15% in 2020, Bloomberg reported, cit- ing Chinese customs data and its own calculations. China’s imports of Australian wheat reached 4.97 MMT in January through October, the highest ever in data that goes back to 2004. Remember the rule “follow China”. Egyptian GASC purchased wheat through direct nego- tiations for the fourth time in a row. If earlier only Russian wheat was purchased in the amount of 640 thousand tons, on November 24 it was purchased 140 thousand tons from Russia and 35 thousand tons from Ukraine at a price of $361/t CNF. A week ago, on November 17, GASC purchased 300 kt of Russian wheat from two Russian-linked traders Solaris (240 kt) and Aston (60 kt) at a price similar to the purchase price two weeks ago - $362/t CNF with delivery on December 22 and January 2023. Thus, for almost 5 months of the new season, Egypt, represented by GASC and private buyers, purchased in Russia, taking into account the volumes already delivered, almost MMT. Imports in general for the entire 2022/23 sea- son are forecasted by the US Department of Agriculture which Russia can supply at the current rate up to 8MMT. These volumes are close to the levels of 2020/21 (8.3MMT) and 2017/18 (8.6MMT), when total Egyptian imports were generally higher - at the level of 12-12.5MMT per season. As we can see, despite the unprecedented harvests de- clared by Russia, in percentage terms, the demand for grain from a state recognized by the European Parliament as a