Wheat falls over ample Black Sea supplies

By Onome Amuge

Wheat futures extended losses on the Chicago Board of Trade (CBOT) as the market plunged to a fourth weekly decline, pressured by ample Black Sea supplies that are giving stiff competition to U.S. exporters.

As a result, the most-active wheat contract on the CBOT stumbled 0.9 percent to trade at $7.75-3/4 a bushel. The grain also declined 2.5 percent for the week.

Dealers noted that a record wheat production in Russia, the world’s biggest exporter, and ample supplies elsewhere from the Black Sea region are adding pressure on U.S. futures.

The U.S. Agriculture Department (USDA) said export sales of wheat totalled 162,500 tonnes in the week ended Nov. 24, well below the low end of analysts’ forecasts that ranged from 300,000 to 725,000 tonnes.

Meanwhile, Argentina’s wheat production outlook is likely to face more cuts due to lower-than-expected yields, said the Buenos Aires grains exchange, as the harvest of the grains advances in the midst of a prolonged drought.

On the other hand, soybeans traded higher after the U.S. government proposed smaller-than-expected biofuels blending requirements.

Soybeans added 0.2 percent to $14.33-1/4 a bushel, but was little changed for the week.

Dealers also noted that soybeans had been underpinned in recent sessions by signs that  China was easing its Covid-19 restrictions following some public protests in the world’s second largest economy.