CNS Canada — U.S. wheat futures posted sharp losses over the past few weeks, but values found support on Tuesday as weather forecasts provide nearby direction, according to an analyst.
Minneapolis and Kansas City wheat contracts lost roughly US30-40 cents per bushel over the past month, as ample world supplies weighed on values.
“We’ve certainly seen some pressure, when you look at the markets,” said Bryan Strommen of Progressive Ag at Fargo, N.D.
The latest long-range forecasts, calling for wetter weather in some of the drier winter wheat-growing regions of the country, also weighed on prices, he said.
However, he added, the nearby weather remains hot and dry for the next week to 10 days.
“The crop is coming out of dormancy, and moisture is something that will be watched,” said Strommen, noting the latest condition ratings were already downgraded slightly.
The nearby weather patterns are especially important for the Kansas City and Chicago winter wheat contracts, causing those markets to gain some ground on Minneapolis spring wheat.
However, Strommen said spring wheat was also seeing some independent strength on lowered stocks projections from the U.S. Department of Agriculture, talk of increased Chinese demand for higher-protein wheat, and expectations for a reduction in U.S. acres this year.
— Phil Franz-Warkentin writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.