CANBERRA: Chicago Board of Trade (CBOT) wheat futures fell on Wednesday as high crop ratings and favourable weather boosted hopes for US yields and plentiful Russian supply diminished demand for US exports.
Wheat rises but strong supply, rising dollar limit gains
Soybeans and corn were little changed.
Fundamentals
The most-active wheat contract on the Chicago Board of Trade (CBOT) was down 0.7% at $5.41-1/4 a bushel by 0041 GMT, while CBOT soybeans fell 0.2% to $11.71-1/4 a bushel and corn climbed 0.1% to $4.26-3/4 a bushel.
All three contracts tumbled to their lowest levels since 2020 in recent months amid ample supply, and speculators are betting prices will fall further.
The US Department of Agriculture (USDA) on Monday rated the US winter wheat crop at its highest early spring level in five years and crop-boosting rains are forecast for the southern US Plains wheat belt.
Huge Russian wheat exports, which consultancy SovEcon estimates set a March record of 4.9 million tons last month, are weighing on the market. Russia expects another large wheat harvest this year.
News that a vessel loaded by TD RIF had left a Black Sea port in recent days eased concerns over that a dispute between the major export firm and Russian authorities could disrupt shipments.
Saudi Arabia bought 795,000 tons of wheat in a tender on Monday, which traders said would likely be sourced from the Black Sea region.
US wheat exports in this marketing season are lagging the previous year’s pace.
A strengthening dollar has also made US farm products more expensive for importers with other currencies.
The European Union’s soft wheat exports since the start of the 2023/24 season in July were 23.01 million metric tons by March 27, compared with 23.86 million a year earlier, EU data showed.
India has asked global and domestic trade houses to avoid buying new-season wheat from local farmers to help the government-backed Food Corporation of India (FCI) procure grain to shore up its depleting reserves, sources said.
Commodity funds were net sellers of Chicago wheat, soybeans and corn on Tuesday, traders said.