Agriculture Futures Lowered Amid Uncertainty

Agriculture commodities prices declined in the middle of external supply factors and decreased exports, according to the latest data.

Wheat

Wheat prices rise along with US exports

• Wheat futures fell for a third session to trade at $6.7 per bushel on Friday’s session, retreating from 10-month highs, as traders evaluated the impact of forecasts of rain in parts of Russia on the world’s top exporter’s harvest estimates.
• Benchmark wheat prices reached $7.20 per bushel last week, the highest since July, after recent cuts to Russian harvest estimates due to dryness and spring frosts.
• However, weather forecasts now suggest rain in the coming week may reach the dry regions of Russia. Additionally, the start of the harvest in the southern US Plains has added seasonal supply pressure.
• In the US Midwest, brief periods of clear skies could help producers complete planting, which has been delayed in some areas by sporadic rains.
• US Wheat accumulated Exports are higher by 403k compared to the previous year, indicating strong demand dynamics that could support a short-term bullish movement.

Corn exports surge but prices remain below $5 mark

• Front-month Corn futures closed the week at the lowest since May 9^th, standing at $4.463 a bushel. That was the 4^th consecutive session that closed in red for the US corn market.
• Progress report disclosed that Corn planting in the US is 6% behind last year’s pace, 1% ahead of the 5-year average pace.
• June and July weather are considered important catalysts for grain production with the majority of analysts raising concerns for increased volatility in the upcoming weeks.
• US corn accumulated exports continue to extend the difference from the previous year, standing at 37.9m metric tons vs 30.5m metric tons, remaining in line with the 5-year average, indicating a strong comeback from the 2020 fall

Soybeans futures struggle to find pattern

• Soybean futures traded around $12 per bushel, retreating further from over four-month highs touched in late May, amid ample supply.
• USDA indicated soybean planting was 68% complete, ahead of analysts’ expectations of 66% and the five-year average of 63%.
• Moreover, May’s WASDE report forecasts global soybean production to rise to 687.1 million tons in 2024/2025 on the back of higher production in South America, the United States, and South Africa, and global soybean exports are projected to increase by 4% compared to last year.
•  However, the decline in soybean price is still limited by the Brazilian crop losses from flooding, where 34% of the soybean crop that remains unharvested was affected.
• US Soybeans accumulated Exports remain significantly lower compared to the previous year, raising concerns about weak demand that could add extra downward pressure.