CANBERRA: Chicago wheat futures rose on Thursday as the market braced for a potential Canadian rail stoppage that would disrupt exports from North America, but plentiful supply from the Black Sea region kept prices near four-year lows.
Chicago corn edged higher and soybeans fell, with both crops near their lowest levels since 2020 as a major crop tour reinforced expectations of bumper US production.
The most-active wheat contract on the Chicago Board of Trade (CBOT) was up 0.2% at $5.45-1/4 a bushel at 0308 GMT, after falling 2.3% on Wednesday.
The contract is, however, not far from last month’s four-year low of $5.14.
Canada’s freight rail transport could come to a grinding halt on Thursday following deadlocked talks over labour contracts, threatening exports of Canadian and US wheat.
However, large expected wheat harvests in Russia and North America are keeping a lid on prices, and global demand has been lacklustre, with China, a major buyer in the first half of the year, forecast to slow its imports.
“There’s a lot of supply,” said Andrew Whitelaw, an analyst at consultants Episode 3 in Canberra.
“The Russians are putting in some pretty low offers. That has helped drive the price down,” he said, adding that there was little prospect of a firm recovery in the coming weeks.
In other crops, CBOT corn rose 0.1% to $3.98-1/2 a bushel and soybeans fell 0.4% to $9.78 a bushel.
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Corn yield prospects in Illinois are the biggest in the Pro Farmer crop tour’s 32-year history and the state’s soybean pod count is the largest seen on the tour since 2000, scouts on the annual US Midwest tour reported on Wednesday, echoing positive results from other states earlier in the week.
A rapid weakening of the US dollar in recent days due to expectations of interest rate cuts offered some support for prices by making US crops more competitive on global markets, but the currency was slightly stronger on Thursday.
The US Department of Agriculture on Wednesday reported a third consecutive day of soybean sales to China. However, overall exports to China have been low amid competition from cheap South American crops.
“US soybean shipments into China are down 7.22 million metric tons or 265 million bushels for the marketing year that began September 1, and that trend is expected to continue for the next marketing year,” StoneX analyst Arlan Suderman wrote in a note.