Türkiye on Friday introduced it will halt wheat imports from June 21 till at the very least mid-October to safeguard farmers from value fluctuations, safe home procurement of uncooked supplies and create a positive marketplace for producers.
U.S. and European wheat futures dropped sharply on the news, each falling round 2%, with merchants fearing Russian exporters can be struck by the transfer, compelling provides earmarked for Türkiye to be offered cheaply in different markets.
Türkiye is the world’s fifth largest wheat importer, shopping for primarily from Russia.
In an announcement, Türkiye’s Agriculture and Forestry Ministry stated it will halt imports of wheat till at the very least Oct. 15 in accordance with overseas commerce measures advisable by the Trade Ministry to guard producers, and added different measures would even be taken.
The measures can be applied to “prevent our producers from being affected by price decreases due to supply density during the harvest period, to meet the raw material supply required for our exports from domestic production, and to ensure market stability in favor of producers,” it stated.
European grain merchants feared the import ban would take maintain simply as Russia’s new harvest this summer season was set to enter world markets.
“Russia is likely to be the main loser on this,” a German grain dealer stated. “Russia supplies somewhere between 60%-75% of Türkiye’s wheat imports and this ban looks like it is coming into force just as Russia’s new crop needs to be marketed.”
“If Russian wheat cannot be sold in Türkiye, it will have to be offered elsewhere at low prices, which could mean other importers in the Middle East, Africa and Asia will benefit.”
But this might additionally minimize importer demand for European and U.S. wheat, merchants stated.
Ban could possibly be prolonged
Shortly after the announcement, Russia’s Agriculture Ministry stated it doesn’t imagine that Türkiye’s momentary ban will adversely have an effect on the nation.
Agriculture Minister Oksana Lut stated Russian exporters have been already contemplating tips on how to ship manufacturing volumes to different locations, Interfax news company reported.
On Thursday, the ministry stated the Turkish Grain Board (TMO) had set 2024 crop grain buy costs for durum wheat, milling wheat and barley.
The import halt could possibly be prolonged past Oct. 15 relying on “market conditions on that date,” the ministry added.
It additionally stated the exports of flour from domestically-produced wheat, banned since September 2018, can be allowed and added barley, milling and durum wheat exports can now be executed utilizing a TMO export license in a “controlled” approach.
Türkiye is anticipated to import 12 million metric tons of grain within the 2024/25 season, together with 8.5 million tons of wheat, based on figures from the International Grains Council.
Wheat slides additional
Meanwhile, Chicago and Paris wheat futures prolonged losses on Friday to one-month lows as news from Türkiye weakened the demand outlook and eclipsed considerations over climate injury to crops in Russia.
Corn and soybean futures edged decrease after rebounding within the earlier session when news of tighter guidelines on tax credit in Brazil led to hopes that U.S. exports may gain advantage.
The most-active wheat contract on the Chicago Board of Trade (CBOT) was down 2.1% at $6.26-1/4 a bushel by 9:53 a.m. GMT, on observe for its eighth consecutive day by day fall.
It earlier touched its lowest degree since May 6 at $6.25-1/2, almost $1 beneath final week’s 10-month peak of $7.20.
On Euronext, September wheat (BL2U4) plunged 4.1% in early commerce to 241.00 euros per metric ton, its weakest since May 8.
“This is clearly going to take a major importer out of the market during the first part of the marketing season,” a European dealer stated of Türkiye’s determination.
Türkiye is a key vacation spot for Black Sea wheat, notably Russian wheat, and the absence of Turkish demand might stiffen competitors in different export markets.
The demand setback additional shifted consideration away from climate dangers in Russia, the place analysts have slashed harvest forecasts prior to now month because of frosts and drought.
An announcement by Russian Deputy Agriculture Minister Andrei Razin that Moscow would fulfill all of its export commitments additionally eased considerations about potential Russian export restrictions in response to climate injury.
In different crops, CBOT soybeans fell 0.6% to $11.92-1/2 a bushel, whereas corn was 0.4% decrease at $4.50 a bushel.
Favorable crop situations within the U.S., the place farmers have made regular progress in planting corn and soybeans whereas beginning winter wheat harvesting, have been additionally curbing grain costs.
Source: www.dailysabah.com