Wheat rebounds from 4-1/2-month low on Black Sea supply concerns
- Chicago Board of Trade (CBOT) was up 1.1% at $5.90-1/2 a bushel
Chicago wheat futures rose due to Black Sea export disruptions, offsetting pressure from strong harvests in Australia/Argentina and a strong dollar. Corn and soybeans also gained on tighter US supply outlooks.
- Impact of Black Sea export disruptions on global wheat supply.
- Influence of large Australian and Argentinian harvests on prices.
- How a strong US dollar affects US agricultural exports.
CANBERRA: Chicago wheat futures rose on Friday after slipping to a 4-1/2-month low in early trade, as continued disruption to Black Sea exports outweighed pressure from a stronger US dollar and expectations of large harvests in Australia and Argentina.
Corn and soybean futures rose and were on track for weekly gains after the US Department of Agriculture tightened its US supply outlook for both crops on Tuesday, lifting prices from multi-month lows.
The most-traded wheat contract on the Chicago Board of Trade (CBOT) was up 1.1% at $5.90-1/2 a bushel at 0352 GMT, after falling to $5.82, the lowest since June 30, earlier in the session.
CBOT corn was up 0.9% at $4.46-1/2 a bushel, heading for a weekly gain of 1.2%, while soybeans climbed 0.9% to $12.29-1/2 a bushel and were 3% above last Friday’s close.
CBOT wheat was on track to end the week 0.1% lower, extending a slide that has dragged prices down around 25% from highs in September.
The US dollar held near a 1-1/2-year peak against a basket of other currencies, bolstered by expectations of higher US interest rates.
A stronger greenback can weaken US export demand by making dollar-denominated crops costlier for overseas buyers.
Cheap wheat from Argentina, whose harvest is beginning, is pushing the market lower.
Argentina’s Rosario Grains Exchange on Thursday raised its 2026/27 wheat production forecast by 500,000 metric tons to 24.3 million tons due to better-than-expected weather conditions.
Australia is also ramping up a harvest expected to produce around 32 million tons, several million tons more than many predicted earlier in the growing season.
However, wheat supply from Russia and Ukraine remains restricted due to attacks on shipping in the Black Sea, a problem that peace talks this week failed to resolve.
The long-term closure of Black Sea grain exports will cause supply shortages, analysts say.
“If wheat starts flowing through the Black Sea, there’s likely more downside for prices,” said Rod Baker, an analyst at Bendigo Bank.
“If it doesn’t, we’re getting close to a price floor now.”