Grain market players are reporting that China has cancelled some U.S. wheat purchases, France's farm office said, in a move that could be in response to a recent slide in prices.
The market players cited the cancellations in a monthly supply and demand meeting with FranceAgriMer, but did not provide more details, Adele Dridi, an analyst with the farm office, told reporters.
Several French traders cautioned there were no clear signs of French wheat being cancelled, though they said it was plausible Chinese buyers might reconsider given lower prices.
Around 500,000 metric tonnes of US wheat export sales to China have been cancelled in the past week, according to the US government, and traders have noted a fall in prices to three-year lows as a possible reason for the cancellation of deals that were struck in December.
Soft Wheat Exports
FranceAgriMer cited reduced demand from China as a factor in a downward revision to its forecast for French soft wheat exports outside the European Union for the 2023/24 July-June season.
China has become a major export outlet for French wheat in recent years. About 1.8 million tons of French wheat were exported to China in the first eight months of the 2023/24 season, FranceAgriMer said, making China the second-biggest destination after Morocco.
In contrast, FranceAgriMer increased its forecast for French barley exports outside the EU this season, partly due to recent Chinese demand, with French supplies proving competitive against other origins as importers shifted to barley from maize.
French barley exports have also been boosted by sales to the Gulf, but a rise in French prices this month is expected to halt this demand, Dridi said.
