Chicago | Reuters — U.S. wheat futures fell on Thursday, with the most-active Chicago Board of Trade soft red winter wheat contract plunging 9.5 per cent as traders said the rally sparked by Russia’s invasion of Ukraine had made the grain too expensive for potential buyers.
“The market is pausing to catch its breath a bit,” said Jim Gerlach, president of commodities broker A/C Trading in Indiana. “It overshot fair value, so the market is going to hash it out here and figure out where real demand lies in terms of prices.”
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Benchmark Chicago wheat futures tumbled by their daily limit on Wednesday after surging 54 per cent since the fighting between those two key global exporters started. The sell-off on Thursday was the biggest in percentage terms for the most-active contract since May 2008.
CBOT corn and soybean futures rallied, supported by signs that export demand for U.S. supplies will remain strong following a drought in South American that withered crops in competitors Brazil and Argentina.
CBOT May wheat futures settled down $1.14-1/2 at $10.87 a bushel (all figures US$).
In Europe, May wheat on Paris-based Euronext ended down one per cent at 368.25 euros (C$517.31) a tonne after rising as high as 390.25 during the session.
Talk that French wheat could supply most of a large tender purchase by Algeria fuelled expectations of extra demand for European Union wheat to replace Ukrainian and Russian supplies, which account for about 30 per cent of global wheat exports.
The U.S. Agriculture Department said on Thursday morning that weekly export sales of wheat totaled 370,200 tonnes. Analysts’ forecasts for the weekly total ranged from 250,000 to 700,000 tonnes.
CBOT May corn was up 22-3/4 cents at $7.55-3/4 a bushel and CBOT May soybeans were 14-1/2 cents higher at $16.86-1/4 a bushel.
USDA reported weekly corn export sales of 2.167 million tonnes and soybean export sales of 3.099 million tonnes.
— Reporting for Reuters by Mark Weinraub in Chicago; additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore.
