Chicago wheat futures fell on Wednesday, as forecasts called for welcome rain in the grain belts of Russia and the United States. Corn and soybeans also saw selling pressure, following the downward trend in wheat.
The most-active wheat contract on the Chicago Board of Trade (CBOT) fell 0.8% to $6.37-1/2 a bushel. Corn declined 0.2% to $4.66 a bushel, while soybeans dropped 0.1% to $12.44-1/2 a bushel.
According to Matt Ammermann, a commodity risk manager at StoneX, the wheat market is being weakened by the forecasts of rain in the dry South Russian grain regions and parts of the U.S. hard red winter regions, which would be welcome in both areas.
The bearish sentiment in the wheat market was further exacerbated by the fact that Russian wheat was offered as the cheapest option in a major purchase tender from Egypt on Thursday, underscoring Russia’s continued dominance in the export market.
Corn and soybeans were also facing selling pressure, with Ammermann noting that corn is following the moves in wheat, while soybeans are seeing reduced demand from China, which has been concentrating its purchases on Brazilian supplies due to the recent flood problem.
Traders are also cautious ahead of the U.S. Department of Agriculture’s (USDA) world supply and demand estimates, scheduled for release on Friday. Ammermann stated that the general expectation is that the USDA report will paint a picture of plentiful world supplies, which is adding to the downward pressure on soybeans, wheat, and corn.
Overall, the market is reacting to the improved weather conditions in key grain-producing regions, as well as the anticipation of the USDA report, which could further influence price movements in the coming days.