Chicago | Reuters — Chicago Board of Trade wheat futures took a breather on Monday after setting 8-1/2-year highs last week on concerns about tightening supplies in exporting countries hit by harsh weather.
Russian agriculture consultancy Sovecon trimmed its forecast for Russia’s crop by 0.3 per cent from last week in the latest estimated reduction for the world’s biggest wheat exporter.
The U.S. Department of Agriculture on Thursday slashed its forecasts for harvests in Russia, Canada and the United States, igniting a price rally.
Russia’s declining output and higher prices have caught short international trading companies that sold wheat and other crops to Asian millers on expectations of bumper global supplies, three Singapore-based traders told Reuters.
In Europe, France’s soft wheat harvest showed uneven test weights, a key measure of milling quality, after rains, according to farm office FranceAgriMer.
“There is concern in several major regions about both wheat crop sizes and quality, with tighter than expected global wheat supplies now being generally accepted,” said Matt Ammermann, StoneX commodity risk manager.
CBOT September wheat futures settled Monday down 1-3/4 cents at $7.60-1/2 per bushel, after rising on Friday to $7.74-3/4, the highest on a continuous chart of the most-active wheat contract since February 2013 (all figures US$). CBOT December wheat and most deferred contracts closed higher on Monday.
European Euronext wheat futures edged lower, consolidating after hitting their highest level since December 2012 on Friday.
CBOT soybeans settled up 3-1/4 cents at $13.68-1/4 a bushel. Corn fell 4-1/4 cents to finish at $5.68-3/4 a bushel.
USDA said exporters sold 132,000 tonnes of U.S. soy to unknown destinations, the latest in a string of recent sales.
After Monday’s CBOT close, USDA lowered its U.S. corn crop rating to 62 per cent good to excellent, down two points from a week earlier, and soybean ratings fell by three percentage points to 57 per cent good to excellent. Traders on average had expected no change.
Market players are watching for results from the Pro Farmer Midwest Crop Tour this week, after dryness hurt some growing areas.
USDA last week made a bigger-than-expected cut to its U.S. corn harvest estimate.
“Look for continued volatility as traders decide how they want to play the weather forecasts and react to the Pro Farmer tour,” said Tomm Pfitzenmaier, analyst for Summit Commodity Brokerage.
— Reporting for Reuters by Tom Polansek in Chicago and Michael Hogan in Hamburg; additional reporting by Naveen Thukral in Singapore.