SINGAPORE- Chicago wheat futures fell below $6 a bushel for the first time in more than two years on Monday, as expectations of ample global supplies weighed on prices after a deal to ship Ukrainian grains was extended last week.
Corn and soybeans inched lower with commodity market facing additional pressure on caution around the US debt ceiling talks.
“Global wheat market seems to be well-supplied even though there are some worries around the US winter crop,” said one Singapore-based grains trader.
The most-active wheat contract on the Chicago Board of Trade (CBOT) was down 1.1 percent at $5.98-1/2 a bushel, as of 0530 GMT, after hitting its lowest since April 2021 at $5.98 a bushel.
Corn fell 0.1 percent to $5.54-1/4 a bushel and soybeans lost 0.1 percent to $13.05-3/4 a bushel.
The Group of Seven rich nations on Friday called on all participants of the Black Sea Grain deal “to continue and fully implement its smooth operation at its maximum potential and for as long as necessary,” it said in a statement.
Last week, the Ukraine Black Sea grain deal was extended for two more months, easing concerns over world supplies.
Russia plans to harvest on average around 130 million tons of grain a year and export up to 55 million tons, Russian First Deputy Agriculture Minister Oksana Lut said.
She added that Moscow had managed to increase its grain exports despite some countries rejecting Russian grain because of the conflict in Ukraine, which Russia calls its “special military operation”.
However, deteriorating quality of the US winter crop provided a floor under the market.
Wheat yield potential in Kansas was estimated at 30.0 bushels per acre on Thursday by crop scouts on an annual Wheat Quality Council tour, the lowest since at least 2000.
The agricultural markets were weighed down on worries around the US debt ceiling talks.
Asian stocks and Wall Street futures struggled as US debt ceiling negotiations approached crunch time after stalling last week, while lingering banking fears and fresh geopolitical worries also capped sentiment.
In the soybean market, China’s imports from Brazil fell 16 percent in April compared with the same month a year ago, data showed on Saturday, keeping supplies from the South American nation well behind last year’s level after delays to its harvest.
Large speculators trimmed their net short position in Chicago Board of Trade corn futures in the week to May 16, regulatory data released on Friday showed. – Reuters
