August 2024 Outlook Report: Grains

- Key Indicators: The Freightos Baltic Index (FBX) averaged USD 5,081.75 in Jul-24, an 18.69% increase from USD 4,281.67 in Jun-24. The World Bank’s fertilizer index rebounded, rising for the second consecutive month, increasing by 10.96% from 108.45 points in May-24 to 129.34 points in Jul-24. The 1.81% month-on-month (MoM) increase observed in Jul-24 was primarily driven by a 1.86% rise in urea prices, which more than offsets the declines in potassium chloride (-3.02% MoM) and diammonium phosphate (DAP, -0.66% MoM). In Jul-24, the Food and Agriculture Organization of the United Nations (FAO) Cereal Price Index averaged 110.8 points, a 3.82% decrease from the 115.1 points recorded in Jun-24.

- Wheat: The Australian wheat price decreased by 3.23% MoM to USD 276.91 per metric ton (mt) in Jul-24 due to increased competition from the Northern Hemisphere and Black Sea origins and low Chinese demand. Russian wheat prices dropped 8.65% MoM to USD 220.6 in Jul-24, largely due to higher global supplies and a strengthening Russian ruble. The United States (US) price for Hard Red Winter wheat decreased for the second consecutive month, dropping to USD 259.26/mt in Jul-24. The primary reasons for the decreasing US wheat price include forecasted record-high global production, ongoing domestic winter wheat harvest pressure, and extremely favorable spring wheat production prospects in the US.

- Maize: US maize prices decreased for the second consecutive month, dropping to USD 176.8/mt in Jul-24, a 7.46% MoM decrease. US maize is currently the most price competitive in the global market among major exporting countries on expectations of abundant supplies in the upcoming harvest. Brazilian maize prices decreased for the second consecutive month, dropping to USD 191.78/mt in Jul-24. Ex farm sales and exports have been sluggish in Brazil in the midst of the second maize harvest, putting downward pressure on prices. Argentine maize prices in Jul-24 decreased for the third consecutive month to USD 183.5/mt, a 4.63% MoM decrease. Low prices are primarily the result of large harvests expected in Brazil and Argentina, as well as high stock levels in North America and Brazil.

- Rice: Thai 5% broken rice prices decreased for the second consecutive month in Jul-24, decreasing by 6.65% MoM to USD 589.75/mt. Vietnamese 5% broken rice prices dropped 2.5% MoM to USD 535.3/mt in Jul-24. The Jul-24 price decrease is largely driven by a slowdown in purchases from the Philippines, the largest rice importer in the world. Buyers in the Philippines are waiting for changes in the Philippines’ import policy to take effect as the country is considering a reduction in import tax from 35% to 15%.