The market expects a significant adjustment of data in the December USDA wheat balance sheet

Market participants expect today’s updated wheat balance sheet from the USDA, which should significantly adjust data on production in Russia, Australia, Argentina and Canada, as well as the forecast for wheat exports from Russia against the background of the introduction of export quotas in the second half of the season.

According to the average estimate of analysts, the December report will be neutral, but it will slightly increase the final wheat reserves for the United States, as well as increase global reserves to 276 million tons.

The biggest intrigue remains in relation to data for Russia, where as of December 8, 79 million tons of wheat were threshed from 27.8 million hectares, although in November the USDA estimated the harvest at 74.5 million tons. in addition, if wheat exports are restricted in the second half of the season at 9 million tons, the total export volume in 2021/22 MG will decrease to 30 million tons, while in November the USDA predicted it at 36 million tons.

Wheat prices in the United States are falling amid improved weather forecasts and light precipitation in the winter wheat growing area, as well as traders recording profits ahead of the report’s release.

The December futures trading period ends on December 14, so traders switch to trading March contracts that declined yesterday:

• by 5 5.14 / ton to Чикаго 291.9/ton for soft winter SRW wheat in Chicago,
• by 5 5.7 / ton to H 298.4/ton for hard winter HRW wheat in Kansas City,
• by 0 0.91 / ton to.380.4 / ton for hard spring HRS wheat in Minneapolis.

Refinitiv experts believe that due to better weather conditions for the development of winter crops than last year, wheat production in the EU in 2022/23 MG will increase to 134.1 million tons, which will exceed the European Commission’s November forecast of 130.4 million tons.

According to the European Commission, as of December 5, EU countries exported 12.8 million tons of wheat, which is 11% higher than last year’s figure. FranceAgriMer experts raised their forecast for final wheat stocks in France by 10.7% to 3.51 million tons compared to November estimates due to a reduction in exports.

• December European wheat futures on Paris Euronext fell by €1.25/ton to €279/ton or €316.17/ton yesterday, while March futures fell by €4.75/ton to € 287/ton or.325/ton.

In Ukraine, prices for food wheat fell in ports to 3 314-318/ton or UAH 9650-9800/ton following a decline in prices for Black Sea wheat, which is under pressure from cheaper European wheat. Traders lower prices as export contracts are executed.

Graintrade

Tags: wheat, USA, Argentina, Australia, Russia, EU, prices, Canada, Spain