Wheat futures extend losses as crop forecast eases supply fears

Chicago wheat futures edged lower on Thursday as harvests in the United States and elsewhere and higher production forecasts in major exporting countries eased supply fears, with the September contract slipping to its lowest level in two months.

Corn and soybean futures also dipped amid easing concerns over a heatwave set to strike U.S. corn and soy crops.

With the Chicago Board of Trade (CBOT) reopening after a public holiday on Wednesday,September soft red winter wheat WU24 was down 0.1% at $5.98-1/2 a bushel by 0245 GMT, having fallen as low as $5.97.

The contract has fallen in four consecutive trading sessions and is down around 19% from a high seen last month.

CBOT soybeans Sv1 dipped 0.1% to $11.73-1/4 a bushel and corn Cv1 was trading 0.6% lower at $4.47-1/2 a bushel.

“Grains are trying to stabilise after the latest big drop in prices,” said Ole Houe, director of advisory services at IKON Commodities in Sydney.

“However, in the near term there is not much to stop prices from sliding further,” he said. “There is plenty of wheat coming out of the United States and the Russian crop is stabilising.”

Russia’s IKAR agricultural consultancy said on Wednesday it raised its forecasts for the country’s wheat crop to 82 million metric tons from 81.5 million tons.

Russia is the world’s biggest wheat exporter. Adverse weather led to severe harvest downgrades last month that raised global prices.

In Argentina, the Buenos Aires Grains Exchange bumped up its forecast for wheat planting, saying higher wheat prices and lower input costs were pushing more farmers to sow the crop despite dryness in some areas.

Germany’s 2024 wheat crop is likely to fall 5.5% to 20.34 million metric tons year-on-year, but recent rain should have no major impact, the country’s association of farm cooperatives said in its latest harvest estimate.

Moving to corn, Ukraine’s production estimate was revised upwards by 0.8% amid improved soil moisture levels across key cropping regions, LSEG Commodities Research said in a report.

LSEG Commodities Research also slightly raised its Argentina corn production estimate as the country’s harvest reached its halfway mark.

A heatwave in the U.S. Midwest this week is raising concerns about the eastern Corn Belt’s corn and soy crops, but agronomists said it should have limited impact on plants because they are still in the vegetative growth stage.

Commodity funds were net buyers of CBOT corn, soybean, soymeal and soyoil futures contracts on Tuesday and net sellers of wheat, traders said.
Source: Retuers (Reporting by Cassandra Yap; Editing by Eileen Soreng and Sherry Jacob-Phillips)