SINGAPORE: Chicago wheat futures were headed for a fourth consecutive weekly loss on Friday as northern hemisphere harvests brought new supply into the market and the production outlook improved.
Corn and soybean futures steadied after dropping sharply on Thursday when forecasts for rain in US cropping zones eased fears that a heat wave could stress crops.
September soft red winter wheat on Chicago Board of Trade (CBOT) was up 0.5% at $5.89 a bushel at 0443 GMT but down more than 6% from last Friday’s close.
CBOT July soybeans rose 0.5% to $11.60-3/4 a bushel but were down 1.6% for the week after closing at their lowest in two months on Thursday.
July corn was 0.5% higher at $4.42 a bushel and heading for a 1.8% weekly loss.
Falling Russian harvest estimates pushed wheat prices to a 10-month high of $7.20 last month but the supply outlook in Russia and other countries such as Romania and Australia has improved, said Stefan Vogel, an analyst at Rabobank in Sydney.
“There are a lot of places where the volumes are maybe slightly bigger than the market was expected a few weeks ago,” he said, adding that the beginning of harvest was also rippling through the market.
Chicago wheat futures lower as crop forecast eases supply fears
“As soon as the combines are rolling and volumes are making their way into the supply chain, that’s usually a time that prices will come under pressure.”
The US winter wheat harvest has seen a relatively quick beginning and a hot spell is expected to keep field work advancing this week.
Consultants IKAR this week raised their forecast for Russia’s wheat crop to 82 million metric tons from 81.5 million tons, reassuring the market after steep downgrades last month.
An increased official forecast for Ukraine’s grain crop and an analyst estimate of a record wheat crop in Romania also created expectations of large Black Sea supplies.
In Argentina, the Buenos Aires Grains Exchange bumped up its forecast for wheat planting.
“We expect that the market will soon find its bottom and that we will see some stabilisation in pricing levels,” said Andrew Whitelaw at agricultural consultants Episode 3.
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