US wheat prices ease as crop outlook improves

October 23, 2013

US wheat
US wheat

Wheat futures on the Chicago Board of Trade fell on Tuesday with an improving outlook for the harvest in Argentina and sowings in the Black Sea region helping to erode recent gains. Corn prices eased slightly with improving crop conditions in the United States helping to offset concerns over the slow pace of harvest while soybean futures were also lower.

“Wheat had gone up quite significantly because of unfavourable weather conditions with excessive rains in the Black Sea region but now we are hearing reports of warmer conditions which will help the final phase of planting,” said Vyanne Lai, agribusiness economist at National Australia Bank. “There have been doubts about Argentina’s production but it looks like rains will be helpful for the crop.”

Chicago Board Of Trade front-month wheat fell 0.5 percent to $6.96-1/2 a bushel by 1113 GMT. The market climbed to $7.11-1/4 on Monday, the highest since early June. Rains reached Argentina’s wheat belt over the weekend, providing much-needed moisture for plants two months ahead of harvest, a local meteorologist said on Monday. Dealers also noted Argentina may have overstated damage to this year’s wheat crop.

Argentina will issue a new 2013/14 wheat harvest estimate in the days ahead, a spokesman for the agriculture ministry said on Monday, after publishing an erroneous forecast of 8.8 million tonnes last week. Analysts Agritel said it expected the estimate to be upwardly revised, noting its own forecast was 10.1 million. Winter sowing has resumed on farms in Ukraine and Russia in a spell of dry weather, analysts and officials said last week, easing fears of a drastic drop in the winter grain crop in 2014. “A large part of crops (in Ukraine) have recovered from delay and weather forecast for the next two weeks show no frost risk. Crops should have good conditions to germinate,” Agritel said in a daily update. “Crop delay in Russia is more alarming; however, harvest is progressing quickly.” The US Department of Agriculture in its weekly crop progress report said 79 percent of the US winter wheat crop was planted by Sunday, matching the five-year average. Courtesy Reuters

World Agriculture News,

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