Chicago wheat futures ticked lower on Friday, but the market was poised for a second weekly gain, with production downgrades in top exporters Russia and the United States.
Corn eased, though the grain was on course to record weekly gains of nearly 1% amid strong U.S. export demand and concerns about global supplies.
“U.S. spring wheat crop has taken a big hit due the drought,” said one Singapore-based trader who sells U.S. and Black Sea wheat cargoes to millers in Asia. “Russia also keeps reducing its production forecast.”
The most-active wheat contract on the Chicago Board of Trade
lost 0.2% to $7.11-1/2 a bushel, as of 0316 GMT. The market has gained 1.1% this week, extending last week’s almost 3% jump.
Corn is up 0.9% for the week, the second straight weekly gain, while soybeans are down 1.4%, the third straight weekly loss.
U.S. and Canadian farmers are bracing for a sharply smaller spring wheat harvest due to the driest conditions in decades, as severe weather damages crops.
Russian agriculture consultancy Sovecon said on Monday it had cut its forecast for Russia’s 2021 wheat crop by 5.9 million tonnes to 76.4 million tonnes.
Strong corn demand is expected to underpin prices.
U.S. exporters sold 898,400 tonnes of corn during the week ended July 29, topping market expectations. Exporters also sold 436,200 tonnes of soybeans.
Soybeans also supported by a daily sales notification of 300,000 tonnes of soybeans for delivery to unknown destinations during the 2021/2022 marketing year.
Consulting firm Agroconsult pegged the South American producer’s second-crop at 60.9 million tonnes, down 4.4 million tonnes from its previous estimate.
Commodity funds were net buyers of Chicago Board of Trade corn, soybeans and soymeal futures contracts on Thursday and net sellers of CBOT soyoil and wheat, traders said.
Source: Reuters (Reporting by Naveen Thukral; Editing by Rashmi Aich)