Wheat set for biggest weekly drop in 3 months on Australian crop

Soybeans up, outlook for Chinese demand seen weighing on prices

  
Grain silos are seen on the horizon near Moree, Australia, October 28, 2020.

Grain silos are seen on the horizon near Moree, Australia, October 28, 2020.

REUTERS/Jonathan Barrett

SINGAPORE: Chicago wheat futures were largely unchanged on Friday, but the market was poised for its biggest weekly decline in nearly three months on outlook for a record Australian crop.

Soybeans gained ground, while corn was almost flat.

The most-active wheat contract on the Chicago Board Of Trade (CBOT) Wv1 is down almost 3% this week, the biggest weekly fall since week ending Sept. 10. The market was trading unchanged at $8.15 a bushel as of 0424 GMT.

Soybeans are down 0.2% for the week and corn has lost nearly 2% this week.

Wheat prices have soared in recent weeks, as the possibility of more Russian export restrictions and the risk of rain damage to Australia's crop fanned fears of tight milling wheat supplies.

However, global supply worries have eased in recent days on signs of a stabilising U.S. crop, and Australia's chief commodity forecaster, ABARES, revising its official estimate for the 2021/22 crop to a record 34.4 million tonnes. 

Saudi Arabia said it was seeking 535,000 tonnes of wheat in a tender, after Egypt on Monday bought 600,000 tonnes in its biggest purchase in years. Tunisia and Jordan also made purchases. 

In the soybean market, Chinese importers bought 130,000 tonnes of U.S. beans, the U.S. Department of Agriculture said, confirming deals reported by Reuters on Wednesday. Exporters struck deals to sell another 164,100 tonnes of U.S. soy to undisclosed buyers, the agency said. 

However, China's soybean imports from the United States in 2021/22 are expected to fall sharply from last season after loading delays following Hurricane Ida. 

An early 2022 Brazil soy crop also shortened the U.S. export window to China, the world's top soybean buyer.

Argentine farmers will plant an estimated 7.3 million hectares of corn in the 2021/22 season, the Buenos Aires grains exchange said on Thursday, hiking its forecast from a previous estimate of 7.1 million hectares. 

Commodity funds were net buyers of CBOT wheat, corn, soybean and soyoil futures contracts on Thursday, traders said. Funds were estimated to be net even of soymeal futures. 

(Reporting by Naveen Thukral; Editing by Rashmi Aich) ((naveen.thukral@thomsonreuters.com; +65-6870-3829; Reuters Messaging: naveen.thukral.thomsonreuters.com@reuters.net))


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