May 16, 2013

 

Indonesia buys 45,000 tonnes Canadian wheat

 

 

In recent deals, Indonesian millers purchased 45,000 tonnes of Canadian spring wheat for shipment in July-August while buyers from Vietnam are in the market looking for Australia cargoes for arrival in July.

 

Australian wheat prices rallied this week as tight old-crop supplies buoyed the market even as the US market remained largely unchanged after declining more than 2% last week.

 

Canadian spring wheat was sold to Indonesian millers at around US$365 a tonne, including cost and freight (C&F), traders said.

 

"Most buyers in Indonesia are covered for wheat until July," said one Singapore-based trader with an international trading company. "They are looking for August shipment now but buying is still very slow."

 

Indonesian millers have yet to cover some 250,000 tonnes of wheat for August shipment, traders said.

 

Vietnamese mills, which have been locking in some Australian wheat in containers for July arrival, are negotiating bulk cargoes for July and August shipment.

 

Australian prime wheat with 10.5% protein was quoted around US$350 a tonne, C&F, for July delivery in Southeast Asia and Australian standard wheat was offered at US$345 a tonne - a gain of about US$25 a tonne from last week for both varieties.

 

Australian hard wheat with 13% protein was offered at US$375 a tonne for shipment in July, up around US$20 from last week.

 

"We are simply running out of wheat," said Ole Houe, an analyst at Sydney-based brokerage IKON Commodities. "The Australian old-crop wheat is getting extraordinarily scarce and our domestic prices are rocketing higher. Traders are struggling to get hold of wheat."

 

Planting across Australia's New South Wales, Victoria and South Australia states has been slowed by dry weather although rains expected this week are likely to ease concerns.

 

The Chicago Board of Trade most-active July wheat has gained 0.7% this week after sliding 2.3% last week. US soft white wheat was quoted at around US$325 a tonne C&F, hard red winter wheat at US$355 a tonne and spring wheat with 14% protein at US$375 a tonne. US wheat has been largely unchanged from last week.

 

Traders sold around 30,000 tonnes of Indian wheat to millers in the Middle East at about US$300 a tonne, free on board, for May-June arrival. The wheat market could get support as dry weather threatens the Black Sea wheat crop, traders said.

 

In the feed grains market, Thai millers purchased about 50,000 tonnes of soymeal from Argentina for August-September shipment, traders said. South Korean feed makers were seeking corn and wheat earlier this week.