December 4, 2008

Spain purchases 120,000 tonnes December Ukraine wheat


Around 120,000 tonnes of Ukrainian feed wheat is due to be unloaded at Spain's main grain port Tarragona this month, a port source said on Wednesday (Dec 3, 2008).


The source added that some 154,000 tonnes of feed wheat had arrived last month and that grain silos in Tarragona, in Spain's north-eastern Catalonia region, held some 220,000 tonnes.


Big arrivals of feed wheat from Ukraine have amplified the impact of falling world grain prices in Spain, especially when coupled with a big domestic harvest.


Traders have quoted feed wheat for prompt delivery in Tarragona at EUR128-133 (US$161.8-168.1) per tonne having dropped from about EUR200 at the beginning of the market year in July.


But the pace of deliveries has decreased in line with a slowdown in exports from Ukraine after a massive grain harvest of 50 million tonnes.


On Tuesday, a leading agriculture consultancy said Ukraine's grain exports declined by 10 percent to 2.05 million tonnes in November from 2.28 million in October.


Spanish dealers say the recent return of EU tariffs prompted by falling prices has so far failed to stem the flow of Ukrainian wheat, although it may do next year.


Spain does not grow enough grain to meet its needs and relies heavily on imports, which last year came to more than 12 million tonnes.


However, imports could fall to 7.5 million tonnes in the current campaign due to slow demand from livestock farmers squeezed between rising costs and falling prices.


In Cartagena, another leading grain port where animal feed makers are based, 24,000 tonnes of grain was either unloading or expected from Ukraine, and 20,000 tonnes of corn from Bulgaria or Croatia.

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