KSE100 34350.42  ▲ Increased By 231.03 (0.68%)
KSE30 15000.89  ▲ Increased By 85.48 (0.57%)
BR100 3516.22  ▲ Increased By 11.22 (0.32%)
BR30 18244.64  ▲ Increased By 13.27 (0.07%)

Business Recorder Logo

Jun 07, 2020 PRINT EDITION

Wheat sags on abundant global supplies; corn to contract lows

CHICAGO: Chicago Board of Trade (CBOT) soft red winter wheat futures fell to three-month lows on Tuesday while US hard w

September 03, 2019

CHICAGO: Chicago Board of Trade (CBOT) soft red winter wheat futures fell to three-month lows on Tuesday while US hard wheat futures hit their lowest levels in a decade, pressured by ample world supplies and strong export competition, analysts said.

Corn futures fell to life-of-contract lows on mild crop weather that bolstered confidence in US harvest prospects, and soybean futures followed the weaker trend.

As of 1 p.m. CDT (1800 GMT), benchmark CBOT December soft red winter wheat was down 11 cents at $4.51-1/2 per bushel.

Front-month K.C. hard red winter wheat dipped to $3.62-3/4 a bushel, the lowest spot price on a continuous chart since December 2005. And Minneapolis Grain Exchange September spring wheat hit $4.73, the cheapest spot spring wheat price on a continuous chart since September 2009.

Hard red winter wheat is grown in the southern US Plains and typically milled into flour for bread.

Hard red spring wheat, grown in the northern Plains and traded in Minneapolis, is a top-quality grain used for pizza dough and bagels, and often blended with lesser grades of wheat to improve flour quality.

All three wheat markets sagged on prospects for plentiful global stockpiles.

"The wheat market is searching for demand. We have large crops not only in Ukraine but in Europe, Russia. And end-users, at least near-term, have reasonably good coverage," said Rich Feltes, vice president for research with R.J. O'Brien.

"Importers have been moving towards hand-to-mouth purchasing to take full advantage of the downward trend in prices," said Michael Magdovitz, senior agriculture commodities analyst at Rabobank.

CBOT corn futures fell as forecasts indicated mild Midwest weather and few signs of frost that could hurt late-maturing crops.

"Last week was August, and now we are in September, and it still doesn't look like any frost," Feltes said, adding, "We may have a delayed-harvest crop; we may have a lower quality crop. But we are going to have a crop. That is the message."

CBOT December corn was down 8-3/4 cents at $3.61 a bushel after setting a contract low at $3.61. November soybeans were down 2-1/4 cents at $8.66-3/4 a bushel.

Concern about the US trade row with China, the top global soybean buyer, also hung over the market, as new tariffs on Chinese goods went into effect over the US Labor Day weekend.

US and Chinese negotiators are due to meet in person in Washington this month, but no date has yet been set.

President Donald Trump warned he would be "tougher" on Beijing in a second term if trade talks dragged on, compounding market fears that ongoing trade disputes could trigger a US recession.

Copyright Reuters, 2019