CBOT wheat prices decline due to concerns over export demand

CBOT wheat experienced a decline of 10 cents, settling at $6.21-3/4 per bushel. Over the course of the week, the primary wheat contract on the Chicago Board of Trade (CBOT) saw a decrease of 2.97%.

Meanwhile, K.C. hard red winter wheat for December delivery managed to increase by 2 cents, reaching $7.64-1/2 per bushel. Additionally, MGEX December spring wheat observed a gain of 2-3/4 cents, settling at $8.02 per bushel.

The US dollar demonstrated a slight uptick against a selection of currencies on Friday. This movement coincided with the deliberation within the Federal Reserve regarding the possibility of implementing further interest rate hikes.

In the wake of Russia's withdrawal from a grain deal, a senior US official stated that the United States has identified viable avenues for exporting Ukrainian grain. These pathways include utilizing the country's territorial waters and overland routes. The goal is to restore grain exports from Ukraine to pre-war averages over the coming months. According to data from the Agriculture Ministry, Ukraine's grain exports for the 2023/24 July-June season reached 4 million metric tons by August 25, with wheat accounting for 1.7 million tons of that total.

Chicago Board of Trade soybean futures exhibited an increase on Friday, largely attributed to extreme heat impacting crops across substantial portions of the US Midwest. This weather event, combined with supportive export sales, contributed to the upward movement in soybean prices.

The benchmark November soybean futures witnessed a gain of 16 cents, reaching $13.87-3/4 per bushel. Over the course of the week, the primary soybean contract on CBOT recorded a 2.48% increase, marking its second consecutive week of gains. Furthermore, CBOT December soybean meal futures saw an addition of $2.70, settling at $417.00 per ton. Meanwhile, CBOT December soybean oil concluded 1.18 cents higher at 63.36 cents per pound.

In terms of crop estimates, advisory service Pro Farmer projected the US 2023 soybean crop to potentially reach 4.110 billion bushels. This forecast falls below the most recent estimate of 4.205 billion bushels provided by the United States Department of Agriculture (USDA). Pro Farmer also estimated a yield of 49.7 bushels per acre. The Pro Farmer Crop Tour revealed that soybean pod counts in Iowa exceeded three-year averages, whereas Minnesota's pod counts were the lowest since 2019.

The US Agriculture Department reported that private exporters made sales of 121,000 metric tons of soybeans to China, scheduled for delivery in the 2023/24 marketing year.

Looking ahead, the anticipated return of the El Niño weather phenomenon is expected to contribute to increased soybean production in South America. The weather pattern's heightened rainfall can potentially aid farmers in recovering from the severe drought experienced in the lower latitudes of the continent during the current season, according to meteorologists and grain analysts.