WHEAT declines amid US harvest progress and rains in Russia

After today rollover, US futures on WHEAT declines, because commodity traders track very high US harvest progress suggesting higher supply. Also, two big wheat producers from Russian (IKAR) and Argentina (BAGE) raised production forecasts.

• The observed heat in the U.S. didn't have an impact on wheat prices as agronomists expect very limited influence on crops, as temperatures will probably cool off next week. IKON Commodiites research says that US wheat production is very strong, while Russian crop is set to stabilize after previous estimated production cuts.
• Seasonality in the near term may support wheat bears, after a huge rally which has been stopped near $700 per bushel.The U.S. Department of Agriculture said this week that the winter wheat harvest was ahead of the average of recent years, as climate conditions for both winter and spring wheat improved since last week.
• Russian consultancy IKAR raised its forecasts for the Russian wheat crop to 82 million metric tons from 81.5 million tons before. Some traders expected that the forecast will be lowered again but rains in June eased concerns about crop in Russia In the effect trader will probably expect raising IKAR estimates one step closer to USDA expectations at 83 million tons.
• Also, Argentinian Buenos Aires Grains Exchange raised its forecast for wheat planting, as higher wheat prices and lower costs were pushing more farmers to sow the crop despite dryness in some regions. According to BAGE planting in Argentina neared the halfway point as of June 12.
• On the other side of the Atlantic Ocean, 2024 Germany wheat crop is likely to fall 5.5% YoY to 20.34 million metric tons this year, but recent rain should have no major impact on current crop conditions according to state media commentary.

WHEAT

Chicago wheat slide and stays below key short-term resistance at $600 per bushel after the rollover, signalling that key grain market is well dominated by bears. Large commodity funds are still net sellers of wheat.

Source: xStation5