The Mintec Benchmark Prices [MBP] for Wheat Milling 11% DDP Rouen FR was assessed at €320.00/mt, down 2% week-on-week (w-o-w) on 17th of November. Wheat prices were under pressure last week, mainly due to optimism for the grain corridor deal’s renewal after constructive talks between the United Nations and Russian officials. Additionally, Russian wheat offers in the export market have kept the pressure on world wheat prices.
Just at the beginning of the last week, there was uncertainty whether the grain corridor deal would be extended after 19th November. However, talks between counterparts last week were “promising”, according to market players. Russia demanded to be re-joined to the international SWIFT payment system (especially lifting sanctions on Rosselkhozbank) to increase its own grain and fertiliser exports. In exchange, Russia would be able to export ammonia through the Togliatti-Odessa pipeline, with a 2 million metric tonnes per annum capacity, representing approximately 13% of the global fertiliser export market. According to market sources, the resumption of the pipeline operation could bring Russia USD 2.4 billion in export revenues and Ukraine USD 100 million in transit revenues. A Mintec source said, “I think the exports via Black Sea ports will stay open beyond November, but Russia will want to gain something from the deal or perhaps limit the grain flow to unfriendly countries. Also, Russia needs to fund its war efforts, so resumption of the fertiliser pipeline operation could work for them”. However, the recent missile strikes (15th November) on Poland have raised concerns for safety and the deal’s extension. Nevertheless, on Thursday, 17th the grain corridor deal was extended for another 120 days.