PARIS/SINGAPORE: Chicago wheat eased on Friday as the market weighed the impact of dry weather in several major exporting zones worldwide against US harvest progress and a backdrop of large global supplies.
Soybean futures extended losses to touch their lowest in almost five months, pressured by favourable weather for US crops and a forecast calling for a higher soybean area next season in rival exporter Brazil.
Corn also set a new multi-month low as it was similarly curbed by positive signs for the US growing season.
The most-active wheat contract on the Chicago Board of Trade was down 1.1 percent at $5.20-3/4 by 1130 GMT, pulling back from Thursday’s one-week high and now down marginally over the week.
Weather risks have stirred up wheat markets in recent weeks, with concern about dry weather in parts of Russia, Australia and the European Union adding to worries about drought-reduced yields in the US winter wheat harvest now underway.
“Dry weather in the Black Sea and Australia is supporting prices. This comes as there are also reports of lower than expected yields in the United States,” said Angus Thornton, commodity analyst at Profarmer Australia.
Chicago wheat futures are forecast to remain over $5 a bushel in the second half of 2018, reflecting weather-reduced harvests in several countries, Commerzbank said on Thursday.
Investors were awaiting a clearer picture of yields in the US winter wheat harvest, while also assessing to what extent weather losses would dent hefty global supplies.
The United Nations food agency on Thursday raised its forecast of world wheat production in 2018, reflecting increases for countries such as Argentina and India, and also lifted its projection of world wheat stocks in the coming season.
CBOT soybeans were down 1.2 percent at $9.62-3/4 a bushel, after earlier reaching their lowest since mid-January. Corn was down 0.6 percent at $3.74 a bushel, close to an earlier four-month low.
“Corn and soybean this week showed a very strong downturn in a context where plantings are finalised in corn and nearly finished in soybeans under satisfactory conditions,” consultancy Agritel said in a note.
Beneficial rains for corn and soybean crops are also forecast in the US Midwest through early next week.
In Brazil, the world’s biggest soybean exporter, the soybean planted area is expected to grow by 1 million hectares next season, Agroconsult consultancy said.
Investors are also turning their attention towards next Tuesday’s world crop forecasts from the US Department of Agriculture.
Source: Brecorder
