July 26: Wheat Prices Retreat Around the United States

Wheat prices slipped Thursday as traders took profits off the table. Markets were paying close attention to developments in Europe. The European Commission and the Trump administration are reportedly moving closer to a deal to avoid tariffs and prevent a trade war.

Let’s take a look at the numbers at the Chicago Board of Trade.

Wheat Prices Drop as Traders Take Profits off the Table

Wheat prices retreated on Thursday as sellers took some profits off the table in Chicago, Kansas City, and Minneapolis. The September SRW contract shed 7.25 cents to end the day at $5.355. The December contract fell 5.25 cents to end the day at just under $5.57 per bushel.

In Kansas City, HRW contracts shed 6.75 cents to close at $5.34 per bushel. The December HRW contract dropped by 5.75 cents to close at $5.605.

Traders were taking profits off the table after contracts popped more than 30 cents on Wednesday. Markets largely ignored news that the International Grain Council cut its 2018/19 world wheat production estimate down to 721 MMT. The new number represents a 16 MMT cut, thanks to falling expectations for production in the European Union and Russia.

Spring wheat prices for September did find gains, adding 0.5 cents to close just under $5.88 per bushel. The December contract shed 1.25 cents to end the day just under $6.02.

Today, we got an update from the second day of the Spring Wheat Quality tour.

Tour participants estimate spring wheat yields at 41.3 bushels per acre. That figure is 5.5 bushels higher than what we saw last year, however, it’s important to remember that was a down year due to drought. That said, the figure is still 3.4 bushels lower than the five-year average of 44.7 bushels per acre.

On Thursday, the USDA released its weekly update on exports. The agency announced that net wheat sales for new crop came in just under 386,000 MT. The figure was a 29% jump from the previous week.

However, the agency also said that total exports came in at 409,100 MT. That was a 6% decline from the previous week, but 12% higher than the four-week average. The chart below offers a glimpse of what’s happening with American wheat exports.

Wheat Prices - Weekly Exports

The top five destinations for U.S. wheat exports were Japan (80,300 MT), Mexico (66,300 MT), South Korea (60,300 MT), Iraq (52,300 MT), and the Philippines (45,000 MT).  

Finally, the USDA announced that Taiwanese millers have purchased 102,775 MT of U.S. wheat.

Corn Prices Find Gains in Chicago

In Chicago, the September contract added 2.25 cents to close the day at $3.615. The December contract added 2.5 cents to finish just under $3.76 per bushel.

Net sales of old crop corn came in at 338,500 MT. That figure represented a 47% decline week-over-week. The agency said that new crop sales came in at 747,500 MT.

Total exports came in at 1.281 MMT, representing a 1% drop week-over-week. Check out our chart below for a breakdown of weekly U.S. corn shipments.

Corn Exports Weekly

The top five destinations for American corn exports were Mexico (338,600 MT), Japan (283,400 MT), South Korea (198,500 MT), Colombia (95,700 MT), and Peru (77,800 MT).   

Soybean Prices Move Higher

August soybean prices added 0.5 cents to close just above $8.61 per bushel. The September contract added 0.25 cents to close just above $8.66 per bushel. Markets were paying close attention to developments in Europe, as it was announced that the European Union committed to purchase more American soybeans.

Old crop soybean sales for the week came in at 538,100 MT. This was a solid bump up from the previous week and represented a 69% jump from the four-week average.

Weekly exports came in at 823,600 MT. That figure was a 51% jump from the previous week, and 21% higher than the four-week average. The chart below offers a glimpse of U.S. soybeans exports for the week.

Soybeans Exports Weekly

The top five destinations for U.S. soybeans were the Netherlands (143,300 MT), Egypt (141,400 MT), Mexico (136,700 MT), Bangladesh (83,100 MT), and Taiwan (80,600 MT).

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About the Author
Garrett Baldwin

Garrett Baldwin is a content strategist and editor at FarmLead. He covers the global grain markets and public policy issues related to the agricultural industry. He is a graduate of the Medill School of Journalism at Northwestern University. He also holds a Master’s Degree in Economic Policy from The Johns Hopkins University, an MS in Agricultural Economics from Purdue University, and an MBA in Finance from Indiana University.

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