Global Wheat Prices Decline as US Harvest Accelerates
Wheat Prices Decline
Global wheat prices continue to decline as the harvest season in the United States accelerates. Exporters should pay close attention to these trends, which are influenced by favourable yield figures and an early harvest start in critical regions. This report outlines the current market conditions and provides insights into the factors driving these changes.Chicago, Kansas City, Minneapolis, and Euronext Markets
The week it opened, there was a significant drop in wheat prices. Soft winter wheat in Chicago led the decline, falling by 3.4%. This marks a 13% decrease for the month. Similarly, hard red winter wheat in Kansas City decreased by 3.5%, an 8.7% monthly drop. In Minneapolis, hard red spring wheat prices fell by 2.9%, down 9.3% for the month. September wheat futures on Euronext in Paris also saw a decline, dropping by 2%, representing a 4.4% decrease for the month.Winter Wheat Harvest And Spring Wheat Planting
According to the National Agricultural Statistics Service (NASS) of the USDA, winter wheat had been harvested in 12% of the planted area. This compares to 7% last year and a 5-year average of 6%. The accelerated harvest pace and favourable yield reports are contributing to the decline in wheat prices. Spring wheat planting has also progressed significantly, with 98% of the planned area planted as of June 9. This is up from 96% last year and aligns with the 5-year average. Furthermore, 72% of spring wheat crops are rated in good or excellent condition, compared to 60% last year.Market Focus and Forecasts
Traders are closely monitoring the forecast for increased US wheat harvests. They are also awaiting the USDA’s June report, which is expected to be released soon. Analysts anticipate that the USDA will increase its forecast for US wheat stocks while slightly lowering global stock estimates for the end of the 2024/25 marketing year. In Ukraine, the wheat harvest is expected to start 2-3 weeks earlier than usual due to dry conditions in the central and eastern regions. Despite this early start, crop forecasts remain lower than last year. However, recent rainfall in the south and northwest has improved crop potential in those areas.The accelerated US harvest and favorable yield reports primarily drive the ongoing decline in global wheat prices. Exporters should remain vigilant as market conditions develop. The upcoming USDA report will provide crucial insights into stock forecasts, which could further influence price trends. Additionally, early harvests in Ukraine and fluctuating crop forecasts add to the complexity of the global wheat market.Â
