Turkey secures barley at prices below initial tender

Turkey's state buyer TMO bought 195,000t of feed barley at prices lower than initial offers in a tender on 11 February, it was confirmed today.

TMO's tender closed at $266.20-268.20/t, at the low end of the $266.20-273.60/t cfr initially quoted by participants.

The buyer secured 195,000t in total for delivery on 23 February-23 March, rejecting a combined 60,000t of the 255,000t initially discussed.

Only two cargoes totalling 50,000t were agreed on a cfr basis, with the rest agreed on an ex-works basis and therefore likely to be supplied from stocks already held in bonded warehouses at Turkish ports.

TMO accepted the two 25,000t cfr cargoes on offer from trading firm Aston at $266.20/t cfr Bandirma and $268.20/t cfr Mersin.

TMO also agreed to buy a number of ex-works cargoes, some of which it negotiated down to prices $1-3/t below initial offers. The following prices are given on a cfr basis ($8/t below the ex-works price agreed):

• Arion to supply 10,000t at $268/t Trabzon
• Ipek to supply 50,000t at $268/t Izmir, 25,000t at $266.75/t Iskenderun, 25,000t at $266.75/t Adana and 20,000t at $268/t Samsun
• Sibirya to supply 10,000t at $268/t exw Trabzon and 5,000t at $268/t exw Giresun, respectively

The relatively small — 50,000t — traded on a cfr basis could limit the effect of TMO's tender on international market prices. Furthermore, the market expects participants to cover a large share of their sales with Russian barley. This marks a change from TMO's previous tender on 15 January, when limited Russian and Ukrainian barley supplies meant that participants sourced much of the volume from EU suppliers, including a cargo that loaded earlier this month from France to Mersin, and a second from Germany to Iskenderun. This demand, coupled with purchases from other buyers in the Middle East and north Africa in recent weeks, has kept EU barley prices above those for the bloc's milling wheat.

By Claudia Jackson