US wheat prices are $3/t up on the week, as the recent rally seems to have ‘run out of steam’ with prices moving off the three-month high set earlier this week.
US spring wheat harvest is finally complete, after suffering weather delays with winter wheat sowings reported as being 77% complete
NASS will produce initial US winter wheat crop rating next week, which will be closely monitored given talk of major dryness concerns in the southern plains
Russia’s 2019 wheat crop estimate has been raised to 75.5mln t, according to UkrAgroCosult, who also raised their export projection to 33mln t
Russia’s export pace has slowed, falling behind last season’s pace, just at a time when the country’s crop estimate is expanding
Ukraine’s 2019 grain harvest is likely to rise to a record 71.8mln t this season, including 28.1mln t of wheat, 8.9mln t of barley and 32.8mln t of corn
Kazakhstan’s 2019 grain harvest is almost complete with a total of 19.3mln t of grain versus 21.8mln t by the same time last year, despite an increased 2019 harvested area
EU (French MATIF) prices are up just €1/t on the week, although cash prices remained underpinned from strong export demand, and recent international tenders that showed EU supplies competitively priced
Fieldwork in north and western Europe should hopefully gain momentum with the return of drier conditions, although many areas remain waterlogged following recent heavy rains
UK prices are up just over £1.50/t on the week, as the country remains on ‘Brexit watch’ with the latest developments looking likely for an extension period to be granted, despite the PM pushing for a 31st October Brexit. If an extension is agreed the door to the EU for further exports will open for 3 months at least.
UK winter plantings are also delayed with another spell of wet weather now forecast. Regional differences are evident but we all need a good spell of dry weather to see the rapid progress needed.
In summary, the US markets found good early underlying support on ideas that China will soon be a significant buyer of US soybeans, which attracted ‘spill-over’ support into the corn and wheat pits
US farmers continue their struggles to get corn and soybean crops harvested ahead of a forecast for bitter cold temperatures, and snow, due to hit the Northern plains later this /early next week
As with all ‘bull’ markets, they need to be constantly fed, and if fresh supportive news is not forthcoming, they leave themselves open for bouts of profit taking which seems to be the case for US wheat this week, although short-term, the downside looks limited.