CANBERRA Chicago wheat futures on Thursday clawed back some of their losses from a day before, but expectations of plentiful global supply limited the recovery and held prices near recent lows.
Corn futures rose slightly, but forecasts for crop-friendly rain in US grain belts capped the gains. Soybeans were little changed amid news that China will reduce hog production and look for alternatives to soybean meal in feed rations. The most-active wheat contract on the Chicago Board of Trade (CBOT) was up 0.6% at $5.43-3/4 a bushel at 0639 GMT, after falling 1.6% on Wednesday.
Prices slipped to a five-year low of $5.06-1/4 in May. US wheat is now cheaper than wheat from Europe or top exporter Russia, said Ole Houe, director of advisory services at IKON Commodities in Sydney. “US wheat is ultra-competitive,” he said.
“The US is finding plenty of demand that should have got to Russia ... every time you get down to the sort of levels where we are today, you tend to jump back up again two days later.” That said, Russian prices are likely to fall in the coming weeks as the country’s new harvest - which is expected to be large by historical standards - flows onto the market, he said.
Updates from a crop tour of North Dakota’s hard red spring wheat fields, meanwhile, underlined expectations of a good harvest, with per-acre yields falling from last year’s records but remaining above average.
The market will be watching for revisions to the US Department of Agriculture’s estimates when it releases its World Agricultural Supply and Demand Estimates report on August 12.
Traders also hope that President Donald Trump will get foreign buyers to purchase more US farm goods. Negotiations over a US-European Union deal are ongoing and US-China talks are scheduled for next week. CBOT soybeans were up 0.2% at $10.24-3/4 a bushel and corn rose 0.4% to $4.19 a bushel.
Comments
Comments are closed for this article.