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How did the markets start?

Как стартираха пазарите?
Euronext wheat rose on Friday, but fell sharply for the year after strong export competition from the Black Sea region belied concerns that the war would disrupt trade in the grain.

Supply fears following Russia's invasion of Ukraine in February 2022, which sent prices soaring to record highs, eased in 2023 as Russia maintained large exports while Ukraine established a new supply channel to replace UN-backed an agreement that Moscow withdrew from in July.

The euro's race to a five-month high against the dollar this week continued to limit the export competitiveness of supplies from the European Union.

On Thursday, Egypt canceled an import auction following bids in which Black Sea origin remains cheaper than French supplies, despite Russia's apparent imposition of a minimum export price.

"Russian traders were not seriously disturbed by the level of Russian export prices in the Egypt auction, holding a price lead over most competitors, except for Ukraine, and with private offers to sell Russian wheat still well below the levels seen in international auctions said a German trader.

The expansion of trade through Ukraine's Black Sea Corridor has increased competition in the Black Sea, despite wartime risks.

In December, Ukraine shipped its largest monthly volumes of wheat and corn since March, LSEG shipping data showed, and traders said the traffic increasingly included large vessels bound for Asia.

"Wheat is traded much more actively in Ukrainian seaports, especially feed wheat, and this is a challenge that the EU market will have to deal with in the new year," the trader said.

Morocco, which became the top destination for EU wheat exports as Russia increased its sales to Algeria, remains the focus for new sales from Europe until the end of the season, traders said.

Shipments to China supported French wheat exports, with LSEG and other shipping data showing seven ships departed this month.

Euronext longs held up better this week, boosted by fresh concerns over next year's harvest after rain-hit Western Europe.

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