CANBERRA: Chicago wheat futures fell on Tuesday as supply concerns eased, but prices still headed for their first monthly rise since July after dry conditions damaged yields in Argentina and Australia, raising the prospect of a tighter market.
Soybeans and corn also slipped, with soy set for a monthly gain and corn little changed over the month.
Rain in Argentina has removed the threat of further yield loss there, helping send prices lower in recent days, said Tobin Gorey, an Australia-based independent analyst.
But rain will not undo the damage wrought to crops by dry conditions, he said, adding that further downgrades are likely in western Australia, a major exporting region that remains dry.
The most-active wheat contract on the Chicago Board of Trade (CBOT) was 0.5% lower at $5.63 a bushel by 0415 GMT but up 4% for the month. CBOT soybeans were down 0.4% at $13.02 a bushel but 2.1% higher this month.
Corn was unchanged at $4.78-1/4 a bushel. Ukraine’s grain exports in October have almost halved year on year to 2.15 million metric tons from 4.22 million tons, agriculture ministry data showed on Monday.
However, a new Black Sea export corridor has improved prospects for shipments, leading to a more than 50% increase in the number of rail wagons heading to ports in Odesa region, a railway official said.
Russian wheat export prices flat
The wheat market has been dominated in recent months by huge exports of cheap Russian grain pushing down prices.
As Russia’s harvest nears an end, consultants Sovecon estimated that it will export 4.4 million tons of wheat in October, down from 4.5 million tons a year ago.
Muted demand means the price of 12.5%-protein Russian wheat for FOB delivery late November-early December was unchanged at $224 a ton last week, the IKAR agriculture consultancy said.
The US Department of Agriculture (USDA) rated 47% of the US winter wheat crop in good to excellent condition, the highest for this time of year since 2020.
Improved prospects in the world’s No. 4 wheat exporter could ease concerns about tightening global grain supplies, but US winter wheat won’t be harvested until mid-2024.
The USDA also said the US soybean harvest was 85% complete and the corn harvest was 71% complete, both ahead of their five-year averages.
Meanwhile, Brazil’s 2023/24 soybean planting reached 40% of the expected area by last Thursday, consultants AgRural said, adding that sowing lags levels last year, when 46% of the areas had been planted by the same time.
Commodity funds were net sellers of Chicago soybean, soymeal, wheat and corn futures contracts on Monday, traders said.