Wheat futures on Chicago Board of Trade (WHEAT) surges almost 3% today, reaching a key technical level as global trade tensions persist. What's even more important today, U.S. farmers experience warm and dry weather, allowing for early planting but limiting a total wheat planting potential. This drought stress building for hard red winter wheat in the U.S. Plains, with another 10–12 days of rain-free, hot weather expected.
- Russian wheat farmers hit by hail, worsening ongoing drought problems and reducing the availability of Russian wheat for export. Wheat prices also gain bullish traction due to dry conditions in the Black Sea region, according to AgResource analysis, citing by Bloomberg. Not only wheat, but also CBOT soybean futures rise on unexpected non-China demand.
- As for now, U.S. wheat supplies are up due to increased imports, the highest since 2017/18 season, while exports have been revised downward. The U.S. ending stocks are projected 22% higher YoY. The season-average farm price remains at $5.50 per bushel. Globally, wheat supplies and trade are both expected to decline (lower EU output, slowing exports from Russia and Australia). Despite that, global ending stocks are slightly up (but remain at their lowest level since 2015/16).
Yesterday, CBOT wheat declined slightly due to higher USDA wheat stocks estimates. US wheat ending stocks were increased by 27 mbu to 846 mbu. The report came in above estimates and came as imports were up 10 mbu, exports trimmed by 15 mbu and seed trimmed by 2 mbu. Also, USDA increased the world ending stocks, by 0.62 MMT to 260.70 MMT.
Start investing today or test a free demo
Create account Try a demo Download mobile app Download mobile appWHEAT (H1 interval)
Source: xStation5
The content of this report has been created by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, (KRS number 0000217580) and supervised by Polish Supervision Authority ( No. DDM-M-4021-57-1/2005). This material is a marketing communication within the meaning of Art. 24 (3) of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (MiFID II). Marketing communication is not an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC and Commission Delegated Regulation (EU) 2016/958 of 9 March 2016 supplementing Regulation (EU) No 596/2014 of the European Parliament and of the Council with regard to regulatory technical standards for the technical arrangements for objective presentation of investment recommendations or other information recommending or suggesting an investment strategy and for disclosure of particular interests or indications of conflicts of interest or any other advice, including in the area of investment advisory, within the meaning of the Trading in Financial Instruments Act of 29 July 2005 (i.e. Journal of Laws 2019, item 875, as amended). The marketing communication is prepared with the highest diligence, objectivity, presents the facts known to the author on the date of preparation and is devoid of any evaluation elements. The marketing communication is prepared without considering the client’s needs, his individual financial situation and does not present any investment strategy in any way. The marketing communication does not constitute an offer of sale, offering, subscription, invitation to purchase, advertisement or promotion of any financial instruments. XTB S.A. is not liable for any client’s actions or omissions, in particular for the acquisition or disposal of financial instruments, undertaken on the basis of the information contained in this marketing communication. In the event that the marketing communication contains any information about any results regarding the financial instruments indicated therein, these do not constitute any guarantee or forecast regarding the future results.
