Quotations for American wheat have updated the next lows

December futures for US wheat fell 3.3-7.4% on Friday on news of increasing exports through Ukraine’s Black Sea ports and on data from the USDA’s quarterly report, which raised the production estimate for the US.

Yes, December futures fell:

• by 7.4% to $199/t – for soft winter SRW wheat in Chicago (-6.6% for the week, -10.9% for the month),
• by 3.3% to $243.9/t – for hard winter HRW wheat in Kansas City (-7.4%, -9.2%),
• by 5.6% to $260.6/t – for hard spring HRS-wheat in Minneapolis (-8.8%, -7.3%).
• by 1.7% to €235.5/t or $248.9/t – for wheat on the Paris Euronext (-0.1%, -2%).

According to the USDA’s quarterly report, as of September 1, wheat stocks in the US amounted to 48.44 million tons, which practically corresponds to last year’s 48.39 million tons and slightly exceeds analysts’ forecasts.

USDA experts unexpectedly raised the forecast for wheat production in the United States in 2023 compared to estimates in September from 47.19 to 49.32 million tons (analysts estimate it at 47.05 million tons), which led to a collapse of quotations.

Quotations for wheat in Europe, despite a slight drop on Friday, remained almost unchanged for the week, supported by the reduction of the European Commission’s forecast for the production of soft wheat in the EU in 2023 by 0.4 to 125.3 million tons, which will be inferior to last year’s level. At the same time, the wheat export forecast was left at the level of 32 million tons.

The increase in the number of ships that call for loading at the Black Sea ports of Ukraine also puts pressure on the quotation. In 2023/24 MR, as of September 29, Ukraine exported 3.253 million tons of wheat (3 million tons last year), out of USDA’s forecast of 11 million tons.

In the near future, the market will support the reduction of harvest forecasts in Australia and the adjustment of estimates for the Russian Federation.

Refinitiv Commodities Research experts expect a decrease in yield due to prolonged heat, so they lowered the forecast for the wheat harvest in Australia in 2023/24 MR by 2.2 to 24.8 million tons (ABARES in September estimated it at 25.4 million tons), which is 15 million tons will be inferior to the indicator of 2022/23 MR.

In the Russian Federation, on September 29, 88.6 million tons of wheat were harvested from 25.9 million hectares with a yield of 3.41 tons/ha, while last year on this date, 101.8 million tons were harvested from 28.2 million hectares with a yield of 3. 61 t/ha. Against the backdrop of dry weather in the western regions, 11.2 million hectares have already been sown with winter crops, compared to 9.4 million hectares last year.

Tags: prices, wheat