China turns its attention to Ukrainian barley as prices drop
Chinese importers are said to be in the market looking for Ukrainian barley production for August-October loading dates...
Chinese importers are said to be in the market looking for Ukrainian barley production for August-October loading dates, with trade sources claiming that at least three and as many as 10 cargoes have been traded recently after prices softened and amid relatively high corn prices.
“Around 10 cargoes trades were made on markets. All within the recent week,” a China-based trader said, while European traders reported rumours of fewer cargoes.
“People are speaking about 500,000-600,000 mt. We saw 5-6 cargoes,” a second trader, based in Europe said.
Trade prices were thought to have been concluded at levels around the $284-$287/mt CFR range, all for August loading dates, which equated to around $209-$212/mt on an FOB basis given current freight rates of around $75/mt.
For now, offers for barley out of the Black Sea with the required Chinese documents have been heard in the range of $217-$220/mt FOB, with bids around $10/mt lower.
Barley prices have also been dropping rapidly over the last week and a half, with offers to China losing around $20/mt during the period, as the ongoing harvest brings pressure to values and more offers appear on the domestic market.
Prices had started to fall even before the harvest pressure mounted after rumours surfaced in the market that barley cargoes heading to China had been washed out or deferred to later dates as queues mounted at Chinese ports and traders sought to heavy demurrage costs.
China is one of the biggest barley importers in the world, and second-biggest importer of Ukrainian barley, after importing 2.9 million mt during the July -April period.