December 14, 2004

Argentina's Wheat Exports Soar with Greater Supply

Recovering wheat production in Argentina has boosted exports. With reduced Brazilian demand, more of these exports have been flowing to Mediterranean, African, and even Asian markets, according to the US Department of Agriculture.

Argentina's resurgence into these markets has increased competition, especially with the European Union and United States.

During the last few months, the combination of large, late-season, old- crop supplies and prospects for an even better new crop has pushed down prices, with FOB Buenos Aires more than $40 below Gulf hard red winter.

Although some of the price competitiveness has been lost by near-record freight rates, Argentine wheat has still been quite attractive, especially in Egyptian tenders. GASC (Egypt's state grain purchaser) has already bought over a million tons so far this year, the largest amount ever.