Wheat set for 4th straight weekly decline on abundant world supplies
SINGAPORE: Chicago wheat edged higher on Friday, drawing support from strong demand, but was poised for its biggest weekly drop in almost two months as ample global supplies weigh on the market.
Soybeans were set to post their first weekly decline in three, with delays in Brazilian planting keeping a floor under the market.
The most-active wheat contract on the Chicago Board of Trade has shed 1.6 percent so far this week, the biggest since the week ended Aug. 25.
Soybeans have lost 1.3 percent this week after rising for the last two weeks and corn is down 1.3 percent after posting gains of 0.8 percent in the previous week.
The wheat market has found some support from an uptick in demand for US wheat.
The US Department of Agriculture (USDA) said US wheat export sales touched more than 615,000 tonnes, the biggest weekly tally in two months.
But globally there are ample supplies. The USDA in its monthly supply-demand report last week raised world inventories estimate at the end of 2017/18 marketing year to an all-time high of 268.13 million tonnes with record production in Russia.
Russia's SovEcon agriculture consultancy said on Thursday it had upgraded its forecast for Russia's 2017/18 grain exports by 500,000 tonnes, to 44.5 million tonnes, due to a fast pace for supplies earlier in the season, which started on July 1.
The USDA said private exporters sold 384,000 tonnes of US soybeans to China, the world's biggest soy buyer.
Weekly US soybean export sales, at 1.275 million tonnes, fell below trade estimates. But weekly soymeal and soyoil sales exceeded expectations.
"Demand has been strong for soybeans and some strength has also been from the supply-side story due to dryness in Brazil resulting in planting delays," said Phin Ziebell, an agribusiness economist at National Australia Bank.
"But US yields are still looking good and we don't see a big rally at this stage unless fundamentals change."
For 2018, private analytics firm Informa Economics lowered its forecast of US corn plantings to 90.460 million acres, from 91.880 million acres, according to an Informa client note dated Thursday and obtained by Reuters.
The firm raised its US 2018 soybean plantings forecast to 90.347 million acres, up from its month-ago projection of 89.057 million acres.
In Argentina, farmers are expected to expand corn planting by 5.2 percent this season, the government said on Thursday, as the free-market policies of President Mauricio Macri encourage crop rotation after decades of over-planting soybeans.