Details of offers
to the Iraqi wheat tender highlight Russia's waning competitiveness in exports
over other major exporter, with its advantage over Australian and Canadian
supplies cut to about $10 a tonne or less.
The 150,000 tonnes
of wheat that Iraq bought from Russia equate to a price, excluding freight costs of
some $37 a tonne, to about $377 a tonne, according calculations from one
leading observer seen by Agrimoney.com.
While retaining a
healthy discount to the cheapest US wheat on offer, at more than $400 a tonne
on the same terms, other origins were far closer competitors.
Australian wheat was
offered at a little over $387 a tonne free on board, with Canadian supplies only $8 a tonne more expensive than Russian.
At the last Egyptian grain tender, last week, Canadian supplies were priced at a premium of more than $11 a tonne.
The wheat Iraq purchased, for November delivery, was significantly more expensive than the $320-350 a tonne free on board that Egypt's Gasc state grain buyer paid earlier for Russian supplies, for shipment in the same month.
'Already lost its grip'
The data come amid
a growing industry debate about how long Russia, renowned as a supplier of
competitively-priced wheat exports, can retain its stranglehold on regional
trade, given drought-depleted supplies.
Moscow-based consultancy, on Thursday said that Russia's gain exports would from
next month "start to decline rapidly" from the 3.0m-3.1m tonnes expected this
month, thanks to shrinking inventories, but declined to forecast an October
In the US, a trader
at a major brokerage told Agrimoney.com that Russia has "probably already lost
For US prices, "the
question is how much extra trade that we pick up. It looks like people are
hoping that we will gain a lot of export businesses in non-traditional markets",
such as North Africa and the Middle East, as Russia's supplies dwindle and its
Earlier, broker Benson
Quinn Commodities said that the extent of Russia's early-season sales looked
set to test the country's ports as well as its supplies.
Brian Henry said: "With this [Iraq] business, it appears the Russian have 16
total wheat vessels to load between now and the end of November," including 13
to Egypt, the top importer of the grain.
"This will strain
their infrastructure and could result in some activity being pushed into December."