SINGAPORE: Chicago wheat prices inched higher on Wednesday, snapping a four-day run of declines, after a survey showed a sharp fall in Canadian production that could curb global supplies.
Soybean and corn prices stabilised after falling on Tuesday, when U.S. government data showed that hot and dry weather had not damaged U.S. crops as much as thought.
“Wheat futures have firmed today but the wheat market is focused on record supplies from Russia,” a Singapore-based trader said. “It is difficult for prices to rally given the supplies from Russia.”
The most active wheat contract on the Chicago Board of Trade (CBOT) was up 0.2% at $6.01-1/2 a bushel, as of 0315 GMT. Soybeans lost 0.3% to $13.88-3/4 a bushel and corn added 0.3% at $4.88-1/4 a bushel.
Wheat production in Canada fell by 14.2% in 2023 compared to 2022, a Statistics Canada survey showed on Tuesday, due to lower-than-average precipitation and high temperatures.
However, Chicago wheat prices are down nearly 10% this month, with the market well supplied by cheap Russian grain.
Russia’s Sovecon agriculture consultancy on Monday raised its forecast for this year’s Russian harvest to 92.1 million metric tons from 87.1 million tons.
A Ukrainian official told Reuters that farmers were not expected to reduce the area of winter wheat they sow for the 2024 harvest despite higher logistics costs due to the war with Russia.
Data showed that soft wheat exports from the European Union in the 2023/24 season fell to 4.49 million metric tons by Aug. 27 from 6.31 million tons a year before.
In the soybean market, prices were supported by the U.S. Department of Agriculture (USDA) confirming private sales of 246,100 tons of U.S. soybeans and 105,000 tons of U.S. soybean meal for shipment to unknown destinations in the 2023/24 marketing year.
Soybean prices have risen around 4.5% this month, as hot and dry weather in the U.S. damages crops at a crucial development phase.
Dry weather is expected to continue over the next few weeks but U.S. government data on Monday showed the damage to soybeans and corn was less severe than feared.
Soybeans are trading at their highest levels relative to corn since late 2016, which could lead to overproduction of U.S. soybeans in the coming years, moderating prices.
A Farm Futures magazine survey of U.S. planting intentions for 2024 found that growers expect to increase plantings of soybeans and wheat while reducing corn.
Brazil’s soybean exports could reach 7.37 million metric tons in August, up from 5.05 million metric tons the same month a year ago, grain export group ANEC said.
Commodity funds were net sellers of Chicago Board of Trade wheat, soybean, corn, soymeal and soyoil on Tuesday, traders said.