Sharp declines in the international price of grains, due to the possibility of freeing Ukraine’s exports

The international price of wheat falls.

Strong declines are recorded in the Chicago international market in the face of the possibility that Ukraine’s exports via Turkey will be released.

The price of soybeans whose contract expires next July traded with losses of 2.83% or USD 18.01 and traded at USD 618.52 per ton. For its part, the same contract, but for corn, fell 2.57% or USD 9.35 and the ton was quoted at USD 296.64. Finally, wheat also position July this year registered a fall of 6.05% or USD 25.72 and quoted at USD 399.61 per ton.

International casualties were registered in full controversy in Argentina with the proposal of Alberto Fernandez of decoupling external prices from local ones, by increasing withholdings. Something that received a different approach from the Minister of Agriculture, Julian Dominguezwho assured that there will be no increase in the rates and there will not be a project sent to Congress to modify them.

About, A report prepared by economists from the Buenos Aires Cereals Exchange reflected the low incidence that the increase in the international price of drinks had on the value of a kilo of bread and other derived products.. Taking as a starting point that last March, in the midst of Russia’s invasion of Ukraine, the export price of Argentine wheat increased by 45% and reached USD 461 per ton, the economists used different formulas to calculate how much should be the impact of this increase in the raw material on the final prices of the different products that are made with it, as is the case of bread, flour and dry noodles.

The impact of the international price of wheat on the final price of bread remains at low levels.  (NA)
The impact of the international price of wheat on the final price of bread remains at low levels. (NA)

Taking into account the price scenario previously proposed last March, the price of bread should have increased by $8.45 per kilo, when in reality it increased by $38.46 per kilo. In the case of flour, its price grew by $10.87 per kilo when it should have increased by $9.70 per kilo, and finally noodles grew by $14.62 per kilo and specialists maintain that the higher international price of cereal should be have translated into a rise of $7.05 per kilo.

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While the soybean and corn harvest progresses in Argentina, the two main complexes that contribute dollars to the economy through exports, the total production projections were updated in a campaign that was plagued by unfavorable weather conditions, such as the absence of precipitation in the last summer.

The latest report by the consulting firm Equilibra projected a total harvest of the country’s main crops (soybeans, corn, wheat, barley, peanuts, sorghum and sunflower) of 128.4 million tons, a 7.4% drop compared to the previous campaign. Also, the contribution of agro-industrial exports would reach USD 52,052 million, a 13.7% increase, as a result of international prices that continue at historical levels. However, the specialists pointed out that it will be necessary to closely monitor the interest and inflation rates, and the expectations of production and exports of the great world players in the food markets.

Finally, It was projected for this year a collection by the State in respect of export duties of USD 10,616 million, a 12.7% increase in relation to last year.


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