August 30, 2010

Israeli group purchases European wheat, US corn

A group of Israeli private buyers has bought 20,000 tonnes of feed wheat of European origin and about 25,000 tonnes of US corn products and soymeal in tenders which closed on Thursday, traders said Friday (Aug 27).

Half of the wheat was bought for shipment between October 25 and November 15 at US$247.20 a tonne C&F and half at US$252.50 for shipment between November 25 and December 15. Some 20,000 tonnes had been sought in the tender, closely watched as traditional importers of Russian grains seek new supplies.

Wheat futures surged to two-year highs in early August, almost doubling from June lows, as a drought devastated Russia's harvest and the country announced a sudden grain export ban. Traders said that wheat origin purchased in the tender was optional but thought likely to come from the Black Sea region, probably Bulgaria.

"Some eastern European Union countries not in the euro zone have attractive prices. It looks like some of these east EU countries are set to profit lucratively from the Russian export ban," one trader said.

"Wheat remains more attractive than sorghum at the moment but more sorghum sales cannot be ruled out in future," added one trader.

The corn products comprised dried distillers' grains with solubles (DDGS), a by-product of biofuel production, traded at US$269 a tonne C&F and corn gluten pellets at US$225 a tonne c&f. The soymeal traded at US$1.11 C&F over the Chicago December soymeal contract <SMZ0>. All were for November 1-20 shipment.