January 21, 2008

 

Asia Grain Outlook on Monday: Wheat prices set to soar on strong demand

 

 

Wheat prices are likely to continue soaring in the week ahead, as strong global demand and record low stocks continue to support prices.

 

On Friday, the Minneapolis Grain Exchange March wheat contract set a new record of US$11.94-3/4 per bushel, topping the previous high of US$11.94, which marks the highest price ever for any wheat contract at a U.S. exchange.

 

News that Pakistan's state-run Trading Corporation of Pakistan has received 13 bids totaling 1 million metric tonnes for its tender to import 610,000 tonnes of wheat helped push prices higher.

 

"The highest quoted price by the bidders was at US$653/tonne, cost and freight basis, and the lowest price was quoted at US$450/tonne," the official said.

 

The bids came from global trading companies like Glencore, Cargill and Bunge, among others, the executive said.

 

The bid of US$653/tonne is a first for Asian wheat import tenders, and would mark a new high if selected by Pakistan.

 

It isn't known when Pakistan will award the tender, although it could be as early as this week.

 

Meantime, Chinese crushers picked up their pace of booking fresh soybean import orders, booking 10-11 cargoes in the week ended Jan. 18, compared with three to four in the preceding week, said commodities analysis firm Shanghai JCI.

 

It attributed the rise in orders to lower ocean freight rates and lower offer prices for South American soybeans. The soybean shipments are expected to arrive in China in March and April.