Agricultural Commodities on the Edge

Wheat

Wheat Futures at 1-Week Low on Strengthened Supply

• March wheat futures traded around $5.5 per bushel, their lowest in over a week, as the supply outlook improved with good harvest progress in Argentina and Australia
• Meanwhile, concerns persisted over deteriorating Russian winter wheat conditions and Ukraine’s wheat shipping disruption
• Analysts predict that 37% of Russia’s winter crops are in poor condition compared to just 4% a year ago, marking the worst assessment on record
• In the meantime, the USDA in its December supply and demand report slightly lowered their forecasts for world wheat production, consumption and exports

Corn Prices Surged Due to Amplified Exports

• March corn futures rose above $4.40 per bushel in December, marking a ten-week high, fueled by strong export sales and positive market sentiment
• Since October 2024, U.S. corn export sales have surged, with weekly sales surpassing 2 million metric tons, exceeding typical seasonal averages
• With annual U.S. corn exports projected at 50-60 million metric tons, this pace suggests exports may outpace USDA estimates for 2024/25
• While export sales may slow as harvest pressure eases, ongoing strong demand and competitive pricing should support prices

Soybean Futures are Locked Below $10 Mark

• March soybean prices stabilized just below $10 per bushel, underpinned by strong production outlooks in Brazil and improved weather in Argentina
• Brazilian soybean output for the 2024/25 season is forecast to hit record levels, with Celeres estimating 170.8 million metric tons, nearly 1 million tons higher than previous projections
• Meanwhile, much-needed rainfall in Argentina’s key farming regions has boosted soil conditions as planting progresses
• Despite increased U.S. export sales, soybeans remain locked in a narrow range due to ample global supplies and lingering concerns over potential trade tensions with China