Exclusive-Chinese buyers cancel, postpone Australian wheat buys amid global surplus
investing.comBy Naveen Thukral
SINGAPORE (Reuters) -Chinese wheat importers have cancelled or postponed about one million metric tons of Australian wheat cargoes, trade sources with direct knowledge of the deals said, as growing world stockpiles drag down prices.
News of the moves comes after the U.S. government reported cancellation of more than 500,000 metric tons of U.S. wheat exports last week to China, the world's No. 1 buyer, with international prices trading close to three-and-half year lows.
China increased wheat imports last year after adverse weather damaged its crop, buying mainly Australian, U.S., French and Canadian cargoes.
However, prices subsequently plunged as Russia, the No.1 exporter, began flooding the global market with cheap wheat as it draws down inventories ahead of an expected bumper harvest, which could mean China will look to buy again to lock in lower prices, traders said.
«Chinese buyers have cancelled some deals for Australian wheat, and they are also moving the shipping time from the first quarter to the second quarter, third quarter,» said one Singapore-based trader at an international trading company, which sells Australian wheat to Asia.
A second Singapore trader said trading companies have vacated shipping slots across several Australian ports, which were booked for cargoes due for China. Both traders declined to be named because of the sensitivity of the matter.
Benchmark Chicago wheat futures have fallen more than 14% in 2024 to their lowest since August 2020, thanks to ample world supplies. The market was trading down 1.4% at 0906 GMT on Thursday.
'BEARISH INDICATOR'
China, the biggest buyer of Australian wheat, may have booked the cargoes four to five months ago when prices were higher, said
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