CNS Canada — A general downtrend in U.S. wheat futures remains in place, with all three markets hitting fresh contract lows over the past week.
However, there may not be much more room to the downside, according to an analyst.
“The (U.S. Department of Agriculture) reports on Tuesday (Feb. 9) were not beneficial for the wheat market,” said Bryan Strommen, market analyst with Progressive Ag in Fargo, N.D.
Those reports included confirmation of record-large world wheat stocks and “less than stellar” demand for U.S. exports.
While those underlying factors remain bearish, Strommen said the futures were starting to show signs of developing a supportive technical foundation.
Seasonal trends may start to provide some support in a month to six weeks’ time, he added.
Smaller U.S. winter wheat acreage, dry conditions for dormant crops in Ukraine and Russia, and quality concerns in Argentina are all factors market participants will be watching, according to Strommen.
— Phil Franz-Warkentin writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.