MarketsFarm — As soybeans and corn trend downward on the Chicago Board of Trade, wheat is poised to climb higher, according to Andrew Mages, analyst with Progressive Ag at Fargo, N.D.
The weather outlook has called for scattered showers over the next couple of weeks, which will impact crops in some way, he said.
“The trade has been looking for that for a couple of weeks,” Mages said.
For soybeans, that will mean prices pulling back as the moisture will benefit growing crops.
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Up until Wednesday, Mages said demand from China had been non-existent.
“We haven’t had any flash sales for over a month,” he noted
Then the U.S. Department of Agriculture (USDA) announced a flash sale on Wednesday for 136,000 tonnes of new-crop soybeans to China. Reports indicated China could be acquiring more U.S. soybeans in the days to come.
Mages said that corn will very likely remain lower as well, but not as severely as soybeans.
“We’re in the prime pollination stage season and the scattered rain will help. But the trade won’t know anything for a couple of months how much this rain has helped,” he explained.
Reports suggested above-normal temperatures in the U.S. may have reduced corn’s yield potential. Elsewhere in the world — such as Europe, where temperatures climbed to nearly unheard-of record highs — corn yields will suffer.
As for wheat, Mages said the wet conditions such as across North Dakota and the eastern half of the Canadian Prairies have been hurting crops.
Also, he said, there’s uncertainty over whether Ukraine will be able to export any of its grain through its ports, which are either blockaded or occupied by invading Russian forces.
Last week, Turkey and the United Nations announced a deal between Russia and Ukraine to export grain would be signed during the week of June 25. No announcement of a signing has yet been made.
“They’re going to need wheat from somewhere if they can’t get it out of Ukraine,” Mages said.
— Glen Hallick reports for MarketsFarm from Winnipeg.
