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Wheat Declines — Daily Grain Highlights

By Paulo Trevisani

 

--Wheat for September delivery fell 2.7% to $7.76 3/4 a bushel on the Chicago Board of Trade Friday, as macroeconomic conditions remain bearish and a deal to free up Ukrainian grain exports seemed to advance.

--Corn for December delivery rose 0.5% to $6.03 3/4 a bushel.

--Soybeans for November delivery rose 0.1% to $13.42 1/4 a bushel.

 

HIGHLIGHTS

 

Threat from Ukraine: Wheat is the big loser in Friday's grain complex, falling for the fifth consecutive session. Markets are shaken by fears of a recession that could sap demand, but wheat has the added concern of a potential influx of Ukrainian supply as an agreement with Russia to reopen export routes seems to advance. "The partial opening of Black Sea ports would [allow] Ukraine wheat exports to grow" to 12.5 million metric tons from 10 million tons, AgResource said in a report. AgResource also noted that CBOT brokers estimate that funds have sold 9,500 contracts of wheat.

Retracted Export: The USDA retracted in the afternoon its morning report of export sales of 133,000 metric tons of corn for delivery to China in the 2022/2023 marketing year. The agency said the exporter updated the information.

China Slows: Slower-than-expected economic growth in China weighed on grain markets Friday, while hot and dry weather conditions offered some support by threatening output. "China has secured US wheat recently but has been extremely slow on adding to new US soybean purchases," AgResource said in a report.

 

INSIGHT

 

Weather Support: Corn futures rose as forecasts of weather unfavorable to crops overcome fears that a recession could curb demand. Still, corn "is set to finish the week with losses as general liquidation of commodities has offset any bullishness from the hot/dry forecast as we enter pollination," RCM's Doug Bergman said in a report. He warned for "another big Sunday night trade depending on what the weather models do over the weekend," noting that prices are at historically high levels and "producers should cover downside risk."

Low Wheat Stocks: Wheat futures fell "on follow through selling as US spring wheat areas received rain and Canadian Prairie crop conditions stabilized," Futures International's Terry Reilly said in a report. He added, however, that Argentina's crop prospects are deteriorating. "The five major global suppliers of exportable wheat [are] still expected to end up at multi year lows, for stocks to use, by the end of the crop season."

 

AHEAD

 

-The USDA will release its weekly grains export inspections report at 11 a.m. ET Monday.

-The USDA will release its weekly crop progress report at 4 p.m. ET Monday.

--The EIA will release its weekly ethanol production and stocks report at 10:30 a.m. ET Wednesday.

--The USDA will release its weekly export sales report at 8:30 a.m. ET Thursday.

-The USDA will release its monthly livestock slaughter report at 3 p.m. ET Thursday.

-The USDA will release its monthly Cattle on Feed report at 3 p.m. ET Friday.

--The CFTC will release its weekly commitment of traders report at 3:30 p.m. ET Friday.

 

Write to Paulo Trevisani at paulo.trevisani@wsj.com

 

(END) Dow Jones Newswires

July 15, 2022 15:44 ET (19:44 GMT)

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