CHICAGO: Chicago Board of Trade wheat futures stabilized on Wednesday as traders adjusted positions ahead of a US government crop report, a day after prices jumped on concerns about tightening global inventories.
The US Department of Agriculture is set to issue an update on global grain supplies and demand in a monthly report on Thursday.
Lower yields in Russia’s winter wheat crop, drought damage to North American spring wheat and heavy rain during the European Union harvest have raised uncertainty about availability of export supplies.
Two leading agriculture consultancies in Russia, the world’s largest wheat exporter, cut their estimates for the country’s 2021 wheat crop due to dry, hot weather.
The USDA will likely “make major changes to its global wheat production estimate” to reflect a tightening of major exporters’ stocks, said Arlan Suderman, chief commodities economist for broker StoneX, in a note.
Traders on Thursday will also focus on changes to USDA’s monthly estimates for US corn and soyabean yields amid concerns about unfavorable dryness in certain growing areas.
The most-active CBOT wheat contract ended flat at $7.27 a bushel, following its 2.2% gain on Tuesday. CBOT soyabeans rose 3-1/4 cents to $13.40 a bushel, and corn ended up 6 cents at $5.59-1/4.
“The market is continuing to adjust to substantially lower Russian wheat crop estimates,” said Tobin Gorey, director of agricultural strategy at Commonwealth Bank of Australia.
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