Wheat prices, following corn, rose sharply during the week, reaching levels not seen since the third week of last February. The closing price on Thursday (23) ended up falling a little, reaching US$ 4.70/bushel, compared to US$ 4.67 a week earlier.
Bad weather in the US is also delaying spring wheat planting in that country, as well as threatening the quality of winter crops.
Added to this is the improvement in demand for US wheat. Export inspections totaled 757,704 tons in the week ending May 16, against market expectations of 500,000 tons. The previous week, the volume was 878,299 tons. At the same time last year, the total inspected was just 349,742 tons.
Net wheat sales for the 2018/19 marketing year totaled 114,500 tons in the week ending May 9. This represents 52% below the average of the previous four weeks. For the 2019/20 year, the volume reached 419,400 tons, in line with market expectations.
Regarding the conditions of winter wheat crops, the USDA reported that as of May 19, they were at 66% between good and excellent, 26% regular and 8% between poor and very poor. Spring wheat planting, on the same date, reached 70% of the expected area, against 80% in the historical average for the date.
And in Mercosur, the Fob ton for export remained between US$ 215.00 and US$ 220.00 in purchasing, with the new Argentine harvest quoted at US$ 180.00.
In turn, the wheat market in Brazil remained stable. The Rio Grande do Sul counter closed the week at R$ 40.52/bag, while lots remained at R$ 48.00 for the reference. In Paraná, the counter fluctuated between R$ 44.00 and R$ 46.50/bag, while lots remained between R$ 54.00 and R$ 54.60/bag. In Santa Catarina, the counter remained between R$ 41.00 and R$ 42.00, while lots in the Campos Novos region remained at R$ 51.00/bag.
For now, the weather is helping with the new harvest, especially in Paraná. In Rio Grande do Sul, the rains of the last week delayed planting, but this has not yet caused any concerns. Planting in the state of Rio Grande do Sul is just beginning. In Paraná, planting had already reached 60% of the expected area at the beginning of this week, with very good crop conditions. In this sense, 96% of the crops were in good condition and only 4% in regular condition. As for crop development, 37% were in germination and 63% in vegetative development.
On the marketing side, the process remains slow, with no liquidity due to the shortage of available domestic product. With the rise in the exchange rate to levels close to R$4.10 per dollar, wheat imports have become more expensive, reducing the price of mills, which are still well supplied. If this exchange rate issue continues, it could increase the price of domestic wheat when the new harvest begins, starting in September.
